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THE 
ECONOMIC  CAUSES  OF  MODERN  WAR 

A  STUDY  OF  THE  PERIOD:  1878-1918 


MtiUiamS  College 
DAVID  A.  WELLS  PRIZE  ESSAYS 


dumber  6 

THE  ECONOMIC  CAUSES 
OF    MODERN    WAR 

A  STUDY  OF  THE  PERIOD:  1878-1918 


BY 


JOHN  BAKELESS,  M.  A. 


PRINTED  FOR  THE 

DEPARTMENT  OF  POLITICAL  SCIENCE 

OF  WILLIAMS  COLLEGE 

J&p  ifloftat,  l^arb  anb  Company,  J^eto  i^orfe 

1921 


Copyright,  1921,  by 
MOFFAT,  YARD  &  COMPANY 


PRINTED  IN   THE    TJ.    S.    A. 


TO 
KATHERINE  LITTLE  BAKELESS 


INTRODUCTION 

The  present  volume  is  an  effort  to  trace  the  chain  of 
economic  causes  which  produce  modern  wars.  It  is  an 
effort  also  to  show  that  the  same  series  of  causes,  at  the 
same  time  that  they  bring  about  wars,  are  working  (some- 
what less  effectively)  towards  increasing  international  soli- 
darity. And  finally,  it  is  a  very  modest  attempt  to  indicate, 
tentatively,  the  general  lines  on  which  the  operation  of  these 
economic  causes  in  the  first  direction  may  be  limited  and 
in  the  second  forwarded. 

Originally  it  was  a  study  only  of  the  economic  causes  of 
war;  but  as  the  research  progressed  it  speedily  became  ap- 
parent that  there  was  another  side  to  the  picture.  By  an 
ironic  paradox  the  same  forces  were  producing  two  effects: 
they  were  working  toward  war  and  peace  at  the  same  time. 

The  rise  of  industrialism  has  led  to  a  struggle  for  markets 
and  for  food  supplies  and  raw  materials.  These  have  led 
to  international  friction  culminating  in  war,  mainly  through 
questions  of  colonial  policy.  But  since  industrialism  and 
colonial  expansion  are  impossible  without  a  high  degree  of 
financial  inter-relationship  among  nations,  and  since  the 
interest  of  the  financier  is  usually  (but  not  by  any  means 
always)  in  the  preservation  of  peace  for  the  sake  of  his  in- 
vestments' safety,  the  forces  that  generate  wars  also  gen- 
erate a  force  which  tends  to  prevent  them.  Moreover,  the 
extreme  complexity  of  these  inter-relationships  between 
modern  industrial  states,  through  the  need  for  international 
transportation,  communication,  standardization  of  weights 
and  measures,  publication  of  tariffs,  and  the  like,  has  bred  a 

vii 


viii  Introduction 

spirit  of  co-operation  among  nations  which  is  opposed  to  tie 
war  spirit. 

But  it  is  quite  apparent  that  as  matters  have  stood  hither- 
to, the  economic  causes  are  working  a  good  deal  faster 
towards  war  than  peace.  The  ratio  of  four  peaceful  years 
to  thirty-six  years  of  war  during  the  period  1878-1918 
scarcely  indicates  that  the  war  god  is  going  out  of  business 
immediately.  It  is  for  this  reason  that  I  have  stressed  the 
causation  of  war,  rather  than  its  prevention ;  and  have  tried 
only  in  the  concluding  chapter  to  indicate  very  briefly 
where  the  most  promising  remedy  lies.  For  those  who  are 
familiar  with  their  writings,  my  debt  to  Mr.  J.  L.  Garvin 
of  the  London  Observer  and  to  Mr.  H.  N.  Brailsford  will  be 
too  obvious  to  need  the  acknowledgment  that  I  make  most 
gratefully. 

The  three  quotations  prefixed  to  the  text  serve  to  indicate 
pretty  accurately  in  advance  the  approach  to  the  subject. 
There  is  here  no  effort  to  advance  a  purely  "economic  theory 
of  history";  there  is,  however,  an  attempt  to  demonstrate 
that  the  root  of  modern  war  lies  in  economic  conditions, 
even  though  other  causes  are  sometimes  operative  to  a  less 
extent.  There  is  also  a  constant  effort  to  strip  off  the  dis- 
guises which  purely  economic  motives  are  likely  to  assume. 

The  study  was  begun  while  I  was  still  in  military  service 
at  Camp  Lee,  Virginia.  The  duties  of  a  battalion  adjutant 
having  proved  scarcely  conducive  to  research,  it  was  laid 
aside  and  resumed  some  months  later,  after  which  it  was 
presented  in  skeletal  form  before  the  Seminar  in  the  Phi- 
losophy of  History  at  Harvard.  As  a  result  of  the  criticisms 
received  there,  several  changes  were  made,  and  the  subse- 
quent revision  has  led  to  the  introduction  of  much  additional 
data. 

The  manuscript  has  been  read  by  Professor  William 
Ernest  Hocking,  of  Harvard  University,  by  Professor  Walter 


Introduction  ix 

Wallace  McLaren  and  Dr.  James  Washington  Bell,  of 
Williams  College,  and  by  Mr.  Lennox  Mills,  Rhodes  Scholar 
from  British  Columbia,  greatly  to  its  benefit  and  my  own. 
I  owe  to  the  Reverend  Father  Campbell,  of  the  Society  of 
St.  John  the  Evangelist,  first  hand  information  relative  to 
conditions  in  the  Far  East;  to  Dean  J.  H.  Latane,  of  Johns 
Hopkins  University,  and  to  Professor  I.  W.  Howerth,  of 
the  University  of  California,  assistance  in  locating  refer- 
ences; to  Dean  Le  Baron  Russell  Briggs,  of  Harvard  Uni- 
versity, aid  in  the  revision  of  manuscript;  and  to  Colonel 
James  B.  Gowen,  Executive  Officer,  General  Staff  College, 
United  States  Army,  the  compilation  of  the  list  of  wars 
on  page  46. 

Although  I  am  greatly  indebted  to  these  gentlemen  for 
many  suggestions  of  the  greatest  value,  the  responsibility 
both  for  statements  of  fact  and  for  conclusions  is,  of  course, 
entirely  my  own. 

John  Bakeless. 
Cambridge,  Massachusetts, 
26  October,  1920. 


CONTENTS 

CHAPTER  PAGE 

Introduction vii 

Kl.    The  Causes  of  Wars 1 

X"  II.    The  Economic  Motives  of  Colonial  Rivalry      .  14 

•  III.    The  Economic   Motives  of  the  Wars  of  the 

World:  1878-1914 38 

V  IV.    The   Economic  Motives    of   the   World    War: 

1914-1918 141 

V.    The    Prevention    of    War    by    International 

Finance 177 

VI.    Internationalism  and  Economic  Conflict  .        .  196 

VII.    The  League  of  Nations 212 

•    Bibliography 231 

Index 250 


THE 
ECONOMIC  CAUSES  OF  MODERN  WAR 

A  STUDY  OF  THE  PERIOD:  1878-1918 


"The  potent  pressure  of  economic  expansion  is  the  motive 

force  in  an  international  struggle." 

— H.  N.  Brailsford. 


"The  desire  for  commercial  privilege  and  for  freedom  from 
commercial  restraint  is  the  primary  cause  of  war." 

— J.  A.  Hobson. 


"Economic  interpretation  of  history  means,  not  that  the 
economic  relations  assert  an  exclusive  influence,  but  that  they 
assert  a  preponderant  influence  in  shaping  the  progress  of  society." 

— E.  R.  A.  Seligman. 


THE  ECONOMIC  CAUSES 

OF 

MODERN  WAR 


CHAPTER  I 

THE  CAUSES  OF  WARS 


Sharp  distinction  is  always  to  be  drawn  between  the  real 
and  the  apparent  occasions  of  wars.  The  real,  as  contrasted 
with  the  .ostensible  causes,  are  not  often  clear  and  can  seldom 
be  entirely  understoodN  No  international  conflict  was  ever 
due  to  a  single  cause,  but  all  have  been  rather  the  result  of  a 
group  of  causes,  of  which  only  a  few  have  ever  become 

apparent. 

Nor  are  the  incidents  which  precipitate  wars  likely  to  be 
anything  more  than  sparks,  igniting  magazines  already 
primed  for  explosion.  A  dispute  with  regard  to  a  pig  is 
said  at  one  time  to  have  threatened  war  between  the  United 
States  and  Great  Britain,  and  on  another  occasion  between 
France  and  the  Republic  of  Texas,  then  independent  of  the 
United  States.1  Difficulties  between  Vienna  and  Belgrade 
over  the  export  of  Serbian  pigs  had  much  to  do  with  the 
bitterness  which  culminated  in  the  Sarajevo  murder  and 
the  World  War.  The  cutting  off  by  Spaniards  of  the  ear 
of  an  English  sea  captain  named  Jenkins  was  the  imme- 
diate cause  of  the  war  of  1738  between  England  and  Spain, 

*L  W.  Howerth:  "The  Causes  of  War,"  Scientific  Monthly,  2:118:F  '16. 
See  also  D.  W.  C.  Baker:  A  Texas  Scrap-Book,  p.  315. 

1 


2  The  Economic  Causes  of  Modern  War 

which  later  became  part  of  the  War  of  the  Austrian  Succes- 
sion, but  which  was  first  known  as  "Jenkins's  Ear  War."  1 
Some  of  the  fiercest  fighting  of  the  Nineteenth  Century- 
occurred  during  the  war  between  Peru  and  Chile,  which 
followed  a  dispute  over  manure.  The  blowing  up  of  the 
battleship  "Maine"  in  Havana  harbor  could  never  have 
produced  war  between  the  United  States  and  Spain  had  not 
the  two  states  been  prepared  for  hostilities  by  a  variety  of 
economic,  idealistic,  and  humanitarian  motives.  Nor  could 
Bismarck's  alteration  of  the  Ems  telegram  have  brought 
about  the  Franco-Prussian  War  had  not  both  countries 
been  already  upon  the  verge  of  a  conflict,  from  a  number  of 
causes  of  varying  natures,  dynastic,  nationalistic,  economic, 
and  territorial.  In  all  these  cases,  the  incidents,  tragic  or 
grotesque,  to  which  the  wars  that  followed  have  been  directly 
due,  are  evidently  in  no  real  sense  the  actual  causes.  For 
them,  one  must  look  deeper  and  further  back  in  history. 

Religious  differences;  dynastic  ambitions;  efforts  to 
divert  popular  attention  from  domestic  strife;  "altruistic" 
motives  for  the  spread  of  a  superior  culture;  the  defense  of 
neutral  rights;  compliance  with  the  terms  of  alliances; 
efforts  at  national  unification;  struggles  for  national  inde- 
pendence; aid  extended  to  rebels;  ambition  for  hegemony 
in  the  family  of  nations;  affronts,  real  and  fancied,  to  the 
national  honor;  revenge,  distrust,  hatred,  or  mere  misunder- 
standings between  nations,  leading  to  increased  armaments, 
and  culminating  in  "defensive"  onslaughts  upon  one  an- 
other; the  chauvinism  of  professional  military  or  naval 
castes;  plotting  against  the  peace  and  security  of  neighbor- 
ing states ;  and  finally,  a  wide  variety  of  economic  motives, 
over-population,  immigration  and  emigration  with  their 
attendant  international  friction,  territorial  expansion,  colo- 

1  Edward  P.  Cheyney:  Short  History  of  England,  p.  557. 


The  Causes  of  Wars  3 

nies,  trade  rivalries,  the  needs  of  industrial  states  for  mar- 
kets, raw  materials,  and  food  supplies,  security  for  vital 
arteries  of  trade,  access  to  the  sea,  "scientific"  frontiers,  and 
the  possession  of  strategic  points — all  these  have  been  im- 
portant causes  of  wars  at  one  time  or  another.  Although 
certain  of  them  seem  more  important  at  present,  almost  any 
one  can  be  found  in  some  form  or  other,  usually  not  very 
thoroughly  disguised,  in  the  great  war  which  has  just  come 
to  an  end. 

In  the  kingless  and  apparently  godless  world  of  1920, 
it  is  difficult  to  believe  that  either  dynastic  or  religious 
considerations  could  really  produce  wars;  yet  it  is  but  a 
few  years  since  the  divine  right  of  kings  was  being  pro- 
claimed in  all  seriousness,  and  since  Russian,  Austrian,  and 
German  troops  were  marching  in  the  names  of  gods  as 
truly  tribal  as  Allah  and  Yahweh  ever  were,  to  support 
the  threatened  Romanoff,  Hapsburg,  and  Hohenzollern 
dynasties.  During  the  same  period,  the  Jehad,  or  Holy  War, 
was  proclaimed  in  the  Moslem  world ;  and  although  General 
Allenby's  campaign  in  Palestine  can  hardly  be  called  a 
Holy  War,  there  is  no  denying  that  a  strong  religious 
interest  attached  to  it  throughout  the  Christian  world.1 

1  In  1866  Lecky  regarded  religious  difficulties  as  a  group  of  war  causes 
soon  to  become  obsolete,  for  he  wrote:  "The  great  majority  of  wars 
during  the  last  1,000  years  may  be  classified  under  three  heads — wars  pro- 
duced by  opposition  of  religious  belief,  wars  resulting  from  erroneous  eco- 
nomical notions,  either  concerning  the  balance  of  trade  or  the  material 
advantages  of  conquest,  and  wars  resulting  from  the  collision  of  the  two 
hostile  doctrines  of  the  Divine  right  of  kings  and  the  rights  of  nations.  In 
the  first  instance  knowledge  has  gained  a  decisive,  and  in  the  second  almost 
a  decisive  victory.  Whether  it  will  ever  render  equally  impossible  political 
combinations  that  outrage  national  sentiment  is  one  of  the  great  problems 
of  the  future." — Lecky:  Rationalism  in  Europe,  vol.  ii,  pp.  219-220. 

The  history  of  the  last  fifty  years  renders  his  error  as  to  the  economic 
factor  so  glaringly  obvious  that  one  is  inclined  to  question  the  accuracy 
of  his  conclusion  as  to  the  "decisive  victory"  which  knowledge  has  gained 
over  religious  hostilities.    The  civd  war  in  Ireland  is  a  case  in  point. 


4  The  Economic  Causes  of  Modern  War 

We  must  go  further  back  in  history  to  find  wars  which 
have  been  fought  with  the  religious  motive  well  to  the  front, 
but  in  all  times  and  in  all  religions  we  find  them.  The  Old 
Testament  teems  with  religious  wars.  Mohammedanism 
has  spread  itself  over  half  the  world  with  the  sword  for 

Mr.  Oscar  T.  Crosby,  President  of  the  World  Federation  League,  a 
graduate  of  the  United  States  Military  Academy,  who  was  for  five  years 
a  lieutenant  of  engineers  in  the  United  States  Army,  points  to  the  com- 
plex intermingling  of  faiths  on  both  sides  in  the  World  War,  as  preclud- 
ing the  entrance  of  the  religious  motive.  (International  War,  Its  Causes 
and  Its  Cure,  p.  230.)  His  religious  tabulation  of  the  warring  powers, 
slightly  enlarged,  is  as  follows: 

Allied  Powers 

British  Empire — Protestant,  Roman  Catholic,  Anglican  Catholic,  Ag- 
nostic, Hindu,  Mohammedan,  Parsee,  Buddhist,  Jaina,  Animist,  Jewish, 
Agnostic. 

France — Roman  Catholic,  Agnostic,  Protestant,  Mohammedan,  Buddhist, 
Confucian,  Animist,  Jewish. 

Russia — Greek  Catholic,  Protestant,  Mohammedan,  Buddhist,  Armenian, 
Jewish. 

Italy — Roman  Catholic,  Agnostic,  Jewish. 

Japan — Buddhist,  Shinto,  Christian  (of  diverse  shades),  Agnostic. 

America — Protestant,  Anglican  Catholic,  Roman  Catholic,  Greek  Cath- 
olic, Jewish,  Mohammedan,  Agnostic. 

Serbia — Greek  Catholic. 

Central  Powers 

Germany — Protestant,  Roman  Catholic,  Agnostic,  Jewish,  Buddhist. 

Austria — Roman  Catholic,  Protestant,  Agnostic,  Jewish. 

Turkey — Mohammedan,  Armenian,  Jewish. 

Bulgaria — Greek  Catholic,  Jewish. 

The  religious  motive  is  no  doubt  of  minor  importance  in  the  wars 
of  the  modern  world,  but  the  well-known  fact  that  the  German  General 
Staff  deliberately  counted  on  a  Mohammedan  Holy  War,  together  with 
the  other  facts  that  I  have  given,  serves  to  show  that  it  is  not  dead  by 
any  means.  So  astute  an  observer  of  international  events  as  Dr.  E.  J. 
Dillon  remarks:  "It  is  a  fact — not  yet  realized  even  by  the  delegates 
themselves — that  distinctly  religious  motives  inspired  much  that  was  done 
by  the  Conference  on  what  seemed  political  or  social  grounds."  (The  In- 
side Story  of  the  Peace  Conference,  p.  489.)  Although  Dr.  Dillon  later 
(p.  496)  regards  "the  plea  that  war  may  be  provoked  by  such  religious 
inequality  as  still  survives"  as  "unreal"  it  is  evident  that — however  "re- 
ligious inequality"  may  be  consideredi — a  force  which  is  still  so  vital  as 
"religious  motives"  were  at  Paris,  is  seriously  to  be  reckoned  with. 


The  Causes  of  Wars  5 

mission ary.  Christianity  itself  did  not  disdain  to  go  crusad- 
ing, and  the  history  of  Europe  is  filled  with  the  battles  of 
Catholic  and  Protestant. 

The  clearest  modern  instance  of  a  series  of  wars  resulting 
primarily  from  dynastic  ambitions,  is  to  be  seen  at  the 
beginning  of  the  Nineteenth  Century,  in  the  Napoleonic 
Wars.  Although  even  here  we  do  not  have  a  case  of  wars 
produced  solely  by  dynastic  ambition  (for  there  were,  of 
course,  other  causes),  we  have  at  least  an  example  of  an 
ambitious  ruler,  would-be  founder  of  a  dynasty,  thirsty  for 
power,  deliberately  embroiling  Europe  for  a  period  of  many 
years,  for  the  sake  of  gratifying  his  own  ambitions. 

Not  only  may  a  ruler  who  regards  the  interests  of  his 
dynasty  as  paramount  engage  in  a  war  to  enhance  its 
prestige,  or  to  enlarge  its  domains;  but  he  may  also  find 
in  war  a  convenient  means  of  solidifying  its  power  at  home 
by  diverting  popular  attention  from  domestic  difficulties. 
The  unanimity  with  which  the  widely  diverging  parties  of 
the  German  Empire,  from  Junker  to  Socialist,  joined  in 
1914  for  the  period  of  the  war,  is  a  case  in  point.  Nor  is 
warfare  as  a  means  of  promoting  harmony  within  the  state 
unknown  even  to  republics.  Immediately  prior  to  the 
outbreak  of  the  American  Civil  War,  Secretary  Seward  and 
his  followers  are  said  to  have  been  casting  about  for  a  for- 
eign war  as  the  most  convenient  means  of  allaying  the  grow- 
ing discord  between  North  and  South.1  Only  in  the  union 
before  a  common  foe  resulting  from  the  Spanish-American 
War  did  sectional  hostility  in  the  United  States  finally 
vanish. 

To  talk  of  an  "altruistic"  war  seems  almost  a  contra- 
diction in  terms,  and  yet  there  can  be  no  question  that 
France  in  the  days  of  the  First  Republic  was  ready  to  carry 

1  O.  T.  Crosby:  International  War,  Its  Causes  and  Its  Cure,  p.  335. 


6  The  Economic  Causes  of  Modern  War 

the  gospel  of  "Liberte,  egalite,  fraternite,"  to  an  unwilling 
world  by  force  of  arms,  just  as  in  the  recent  war  our  German 
adversaries  went  forth  with  the  avowed  intention  of  bestow- 
ing upon  a  benighted  globe  the  inestimable  advantages  of 
a  superior  Kultur. 

Phrases  like  "the  white  man's  burden," — which,  as  we 
shall  presently  see,  is  a  highly  profitable  load — are  efforts 
to  cast  the  cloak  of  altruism  over  the  stark  economic 
motivation  of  European  colonial  conflicts.  England  in 
Egypt  and  Africa,  the  United  States  in  the  Philippines, 
Italy  in  Tripoli,  France  in  Tunis,  Algiers,  Morocco,  and 
Indo-China,  insist  that  they  are  altruistically  and  with 
sublime  self-abnegation  doing  their  share  in  caring  for  the 

".  .  .  new-caught,  sullen  peoples, 
Half-devil  and  half-child." 

War  also  assumes  an  ethical  aspect  when  the  warring 
powers  profess  to  be  engaged  in  a  struggle  on  behalf  of 
the  rights  of  neutrals,  as  was  the  case  when  the  United 
States  went  to  war  with  Great  Britain  in  1812  in  defense 
of  neutral  rights  at  sea,  or  when  in  1914  Belgium  struck  in 
defense  of  her  neutrality,  or  Great  Britain  (partly)  in 
defense  of  the  same  neutrality.  But  Great  Britain,  in 
addition  to  the  enormously  important  economic  motives 
to  be  discussed  later,  was  also  engaged  by  alliance  to  uphold 
Belgian  neutrality,  one  of  the  numerous  examples  afforded 
by  the  World  War  of  compliance  with  the  terms  of  an 
existing  alliance  as  an  occasion,  though  not  a  true  cause, 
of  war. 

What  appears  to  be  an  innate  human  tendency  to  group 
in  increasingly  large  units,  has  contributed  its  share  to  the 
wars  of  the  world.  The  ancient  world  grouped  and  re- 
grouped itself,  at  the  price  of  endless  warfare,  again  and 
again,  as  Assyrian,  Babylonian,  and  Egyptian  Empires  rose 


The  Causes  of  Wars  7 

and  fell.  Out  of  the  large  unit  which  was  the  Roman 
Empire  came  the  grouping  and  regrouping  of  the  Holy 
Roman  Empire. 

The  last  century  has  seen  the  unification  of  the  German 
Empire,  the  unification  of  Italy,  and  the  settling,  once  for 
all,  of  the  question  of  the  unity  of  the  United  States. 
Sometimes  such  processes  of  national  unification  can  be 
brought  about  by  agreement.  More  often,  in  the  past, 
unification  has  come  through  war.  It  was  the  wars  of 
1864,  1866,  and  1870  that  made  possible  the  union  of  the 
scattered  German  states;  it  was  through  battle  that  a  United 
Italy  came  together;  and  it  was  only  after  four  years  of 
bitter  warfare  that  our  own  country  became  forever  a 
united  land. 

Colonies  and  dependencies,  and  even  countries  which  are 
merely  political  associates,  can  usually  become  free  and 
independent  states  only  by  appeal  to  arms.  The  peaceful 
separation  of  Sweden  and  Norway  was  a  most  unusual 
incident.  Every  Republic  in  North  and  South  America  won 
its  freedom  with  the  blood  of  its  citizens.  Greece,  Serbia, 
Bulgaria,  Montenegro,  Roumania,  have  one  by  one  cast  off 
the  yoke  of  Turkish  suzerainty  through  war.  Because  the 
desire  for  national  independence  leads  to  conflict,  we  have 
within  the  last  three  years  seen  one  small  state  after  another 
split  from  the  empire  of  which  it  had  hitherto  been  a  part, 
and  with  an  army  in  the  field  assert  its  right  to  an  inde- 
pendent existence. 

When  a  subject  nation  is  thus  engaged  in  a  war  for 
independence,  other  powers,  already  hostile  to  its  suzerain 
from  a  variety  of  reasons,  may  make  use  of  the  occasion  to 
come  to  the  assistance  of  the  rebels,  paying  off  old  scores 
under  the  convenient  cloak  of  idealism.  Thus  it  was  that 
France  sent  troops  to  the  aid  of  the  rebellious  American 
colonies  of  her  traditional  foe,  Great  Britain;  and  both  in 


8  The  Economic  Causes  of  Modern  War 

European  and  South  American  countries  the  United  States 
has  been  credited  with  a  similarly  Machiavellian  policy  in 
the  Cuban  intervention. 

The  rise  and  fall  of  German  hegemony  in  Europe,  com- 
prised within  the  period  1862-1918,1  furnished  an  excellent 
example  of  a  series  of  wars  fought  for  the  sake  of  the  leader- 
ship of  one  nation  among  the  rest.  Under  Bismarck's  adroit 
statecraft,  the  war  of  1864  aggrandized  Prussia  at  the 
expense  of  Denmark,  and  furnished  the  spark  which,  judi- 
ciously fanned,  burst  into  flame  in  the  war  with  Austria  in 
1866.  With  the  defeat  of  Austria,  Prussia  won  the  hege- 
mony among  the  scattered  German  states,  and  after  that, 
by  the  defeat  of  France  in  the  Franco-Prussian  War,  the 
hegemony  of  Europe.  Since  then  a  series  of  threats,  demon- 
strations, diplomatic  crises,  and  war  scares  have  gone  to  the 
maintenance  of  that  hard-won  hegemony,  culminating  at 
last  in  the  grand  debacle  of  the  present  war  and  the  dis- 
appearance of  German  leadership. 

The  desire  to  maintain  the  hegemony  of  a  nation  leads 
its  statesmen  to  be  highly  sensitive  when  that  extremely 
nebulous  quantity  known  as  the  "national  honor"  is  in- 
volved, and  to  be  ready  to  threaten  war  over  incidents 
trifling  in  themselves,  but  regarded  as  tending  to  belittle 
the  prestige  of  the  nation  and  to  open  the  way  to  further 
and  more  serious  infringements  of  its  dignity  by  the  offend- 
ing nation.  A  case  in  point  is  the  scuffle  at  Casablanca  in 
which  a  German  consul's  cane  was  broken.  That  broken 
cane  very  nearly  brought  all  Europe  into  war. 

Mutual  hatred  or  the  desire  for  revenge  between  nations 
is  another  potent  cause  of  war.  The  forty  years  of  sus- 
picion   between    France    and    Germany,    the    policy    of 

1  From  Bismarck's  accession  in  1862  to  the  office  of  Chancellor  to  the 
King  of  Prussia,  to  the  signing  of  the  armistice  which  ended  the  World 
War  in  1918. 


The  Causes  of  Wars  9 

"revanche,"  the  rankling  wound  of  the  economic  and  senti- 
mental loss  of  Alsace-Lorraine,  have  all  but  produced  war 
again  and  again  and  again.  The  distrust  of  Germany  which 
implanted  itself  in  the  English  mind  between  1890  and 
1914,  and  the  growing  dislike  and  jealousy  of  England 
which  made  itself  apparent  a  little  before,  if  not  quite 
simultaneously,  in  Germany,  served  to  open  the  way  for 
hostilities. 

Of  the  numerous  causes  from  which  such  national  dis- 
trusts may  grow,  the  most  prolific  is  the  sheer  difficulty  of 
one  nation  in  understanding  another.  The  mere  barrier 
of  language,  where  it  exists,  is  in  itself  a  contributing  cause, 
since  there  is  no  opportunity  for  the  two  peoples  to  know 
and  understand  each  other.  Where  this  barrier  does  not 
exist,  there  is  unfortunately,  an  appalling  opportunity  for 
friction  through  differences  of  custom,  habits,  manner  of  life, 
all  of  which  may  in  the  end  lead  to  bitterness  because  of  the 
very  fact  that  through  community  of  language,  adverse 
utterances  in  the  journals  of  one  nation  are  readily  com- 
prehended and  copied  by  those  of  the  other. 

Where  international  hatred,  distrust,  or  jealousy  exists, 
the  national  armament  is  certain  to  be  increased.  It  was  in 
obedience  to  this  law  that  France  fortified  her  northern 
frontier,  that  England  added  continually  to  her  fleet,  and 
that  the  work  of  the  German  Flottenverein  resulted  in  the 
building  of  the  one  fleet  capable  of  rivalling  that  of  Great 
Britain.  Likewise,  where  these  national  jealousies  exist,  a 
professional  military  caste  is  almost  certain  to  spring  up, 
its  whole  life  given  to  preparation  for  war — a  caste  always 
on  the  lookout  for  war  (with  which  its  whole  prospect  of 
preferment  is  bound  up),  favoring  war,  and  quite  capable 
of  indiscretions  which  may  bring  it  about.  Such  was  the 
case  in  Germany  prior  to  1914;  such  was  the  case  to  a  much 


10  The  Economic  Causes  of  Modern  War 

less  degree  in  France;  such  was  the  case  to  some  degree  in 
the  British  fleet. 

National  jealousies  and  hatreds,  with  the  perpetual  virus 
of  a  military  or  naval  hierarchy,  even  if  the  last  be  not  all- 
powerful,  distrust  and  suspicion  between  the  nations  in- 
volved, have  as  their  results  constant  uneasiness  and  ever- 
growing tension  of  the  national  nerves.  This  ends  in 
ultimatums,  war-scares,  and  "defensive  attacks"  to  take 
advantage  of  speedier  mobilization — all,  sometimes,  over 
disagreements  which  were  trifling  in  their  origin,  or  at  least 
capable  of  peaceful  solution,  but  which  have  at  last  bred 
terrific  conflicts. 

All  this  leads  naturally  to  what  has  always  been  one  of 
the  chief  reasons  for  warfare — the  economic.  From  the 
earliest  days,  when  primitive  tribes  fought  one  another  for 
hunting  grounds,  for  slaves,  or  for  loot,  economic  considera- 
tions have  been  involved  in  war.  Economics  and  finance 
do  not  merely  enter  into  the  provocation  of  modern  war, 
but  are  themselves  among  the  means  by  which  it  is  carried 
on.  The  blockade  is  a  device  which  was  long  ago  discovered, 
but  today  trade  and  tariff  wars  precede  the  use  of  force,  and 
economic  pressure  helps  to  force  the  enemy  into  submission. 

That  economic  conditions  have  stimulated  war  in  all  ages 
is  a  commonplace  of  history.  The  great  mercantile  powers 
of  the  world  have  always  fought  one  another,  whether  for 
markets,  over  trade  routes,  or  out  of  the  sheer  bitterness 
engendered  of  their  commercial  contests.  But  it  has  re- 
mained for  the  economic  foes  of  our  day  to  penetrate 
into  the  furthermost  corners  of  the  earth  with  quarrels  and 
bickerings  which  have  in  the  end  been  productive  of  the 
bloodiest  of  wars,  to  carry  "civilization" — and  the  surplus 
products  of  their  industries — throughout  the  world,  merci- 
lessly crushing  the  unfortunate  natives  that  have  stood  in 
their  way,  and  in  the  end  coming  into  armed  conflicts  with 


The  Causes  of  Wars  11 

one  another  because  of  the  demand  of  each  for  more  and 
yet  more  opportunity  for  economic  expansion. 

Without  going  to  the  extremes  of  the  out-and-out  expo- 
nents of  the  economic  theory  of  history,  one  may  say  with 
safety  that  there  has  never  been  a  war  into  which  economics 
did  not  enter  to  some  degree,  and  that  there  has  seldom 
been  a  war  into  which  economics  did  not  enter  to  a  great 
degree. 

Pressure  of  population  has  always  been  a  potent  cause 
of  wars.  It  was  this  that  sent  the  Goth  and  Hun  south 
to  the  Mediterranean  as  the  Roman  Empire  tottered  to  its 
fall — the  pressure  of  other  populations,  behind  them,  press- 
ing out  of  Asia,  It  is  this  that  has  caused  modern  wars.  A 
fecund  nation  grows  so  rapidly  that  it  has  no  longer  room 
within  its  borders  for  its  citizens.  Then  comes  either  emi- 
gration, with  its  consequent  loss  to  the  state  of  its  citizens, 
or  else  expansion  into  the  domains  of  a  neighboring  state. 
Encroachment  upon  another's  territories  means  war,  inevi- 
tably. Colonization  means  war,  too,  either  with  other 
colonizing  powers,  or  with  the  natives  whom  the  new  set- 
tlers displace. 

As  the  states  of  Europe  have  grown  in  population  beyond 
the  capacity  of  their  own  soil  to  feed  them,  they  have  turned 
from  agriculture  to  industry.  They  have  had  to  look  beyond 
their  borders  for  food  for  their  populations,  for  raw  mate- 
rials for  their  industries,  and  for  markets  for  their  wares. 
They  have  required  access  to  the  sea,  and  strategic  points 
along  the  trade  routes  by  which  these  things  are  brought 
to  them. 

It  is  the  increase  of  population,  followed  by  the  rise 
of  industrialism,  and  the  consequent  economic  interde- 
pendence in  vital  commodities  without  guaranties  of  eco- 
nomic security  save  by  force,  that  have  rendered  war  inevi- 


12  The  Economic  Causes  of  Modern  War 

table  in  the  modern  world.  The  imperative  need  of  food 
supplies,  of  raw  materials,  of  markets,  and  the  insecurity  of 
a  world  organization  which  makes  it  possible  for  any  of 
these  to  be  cut  off  at  any  moment  by  a  hostile  fleet  or 
army,  lead  to  a  frantic  effort  for  the  acquisition  of  the 
portions  of  the  earth  where  raw  materials  and  food  supplies 
are  to  be  had,  as  well  as  to  the  quest  of  colonies  as  pros- 
pective consumers  of  the  wares  produced  by  the  father- 
land in  excess  of  its  own  (and  general  European)  consump- 
tion. 

This  is  the  situation  which  stimulates  the  trade  rivalries 
that  serve  to  embitter  national  quarrels  already  existing 
for  other  reasons.  Witness  the  increasing  national  hatred 
between  Great  Britain  and  Germany,  which  grew  apace  as 
German  enterprise  and  scientific  methods  gradually  dis- 
placed the  British  in  the  markets  of  the  world.  Out  of 
trade  rivalry  comes  colonial  rivalry,  colonial  wars  waged 
by  the  mother  countries  for  the  possession  and  safeguarding 
of  their  domains,  and  in  the  end,  wars  between  the  great 
colonial  powers  themselves  because  of  quarrels  engendered 
in  their  colonies.  Witness  Fashoda,  witness  Agadir,  and 
witness  the  whole  miserable  business  of  the  Far  and  Near 
East. 

The  chapters  that  follow  are  an  effort: 

First,  to  trace  the  economic  forces  that  have  driven  Euro- 
pean nations  into  constant  collision  with  native  tribes  and 
with  one  another  in  the  backward  lands  of  the  earth — 
primarily  overpopulation,  followed  by  manufacturing 
beyond  their  own  capacity  to  use,  with  resultant  shortage 
of  food  supplies  and  raw  materials; 

Second,  to  examine  the  actual  working  in  history  of  this 
theoretical  chain  of  war  causes,  by  a  study  of  the  origins 
of  the  wars  of  the  period  1878-1918; 


The  Causes  of  Wars  13 

Third,  to  set  forth  the  paradox  by  which  international 
finance  both  produces  and  prevents  wars; 

Fourth,  to  show  the  way  in  which  the  economic  causes 
of  wars  affect  internationalism,  and  their  relation  to  the 
League  of  Nations. 


CHAPTER  II 

THE  ECONOMIC   MOTIVES  OF   COLONIAL  RIVALRY 

Ever  since  states  began,  they  have  founded  colonies, 
although  the  objects  and  methods  of  the  colonization  have 
radically  differed,  as  has  the  status  of  the  colonies  in  rela- 
tion to  the  parent  nations.  Ancient  Greek  colonization,  for 
example,  was  a  very  different  process  in  every  respect  from 
the  colonization  of  our  own  day,  for  the  Greeks — to  whom 
the  state  was  necessarily  a  city — regarded  it  as  being  natur- 
ally a  small  organization,  and  drew  the  obvious  inference 
that  the  surplus  population  was  to  be  accommodated  only 
by  the  founding  of  a  new  state.  Hence  the  classic  colony 
consisted  of  a  body  of  emigrants  from  the  parent  state,  who 
withdrew  from  it  and  went  elsewhere  to  set  up  a  new  tt6\ls 
which  should  carry  on  the  traditions,  customs,  ideals,  habits 
of  life  of  the  old  state,  but  without  any  political  connection. 
Thus  were  founded  all  the  colonies  which  dotted  the 
shores  of  the  iEgean;  and  thus  it  was  that  Carthage  grew 
from  Phoenicia. 

This  was  the  earliest  and  most  natural  method  of  coloniza- 
tion, but  it  was  not  the  only  one;  nor  was  it — especially 
as  means  of  communication  gradually  improved — the  only 
natural  one,  for  to  the  bonds  of  blood,  customs,  and  religion 
could  well  be  added  that  of  political  connection.  A  proto- 
type of  the  classic  colonizing  tradition  is  the  city  of  Miletus, 
with  her  daughter  cities  flourishing  all  about  her;  and  of 
the  modern  tradition,  the  British  Empire,  which  has  grown 
gradually  but  surely  through  the  centuries  by  the  most  suc- 
cessful application  that  the  world  has  yet  seen,  of  the  more 
modern  method. 

14 


The  Economic  Motives  of  Colonial  Rivalry         15 

A  change,  then,  has  come  over  the  methods  of  founding 
and  administering  colonies,  and  it  is  a  change  which  has 
grown  directly  out  of  the  increasing  complexity  of  modern 
civilization.  Not  only  has  there  been  a  change  in  methods, 
but  new  motives  also  have  come  to  make  themselves  felt. 

The  most  important,  and  indeed  the  fundamental  cause 
of  the  demand  for  colonies  is  the  growth  of  the  populations 
of  European  states  beyond  the  capacities  of  the  territories 
of  the  various  nations  to  support  them.  Throughout  the 
entire  continent  an  increase  of  population  has  been  going 
on,  in  some  countries  more  rapidly  than  in  others,  but  in 
almost  all  fast  enough  to  cause  the  numbers  of  the  popula- 
tion to  exceed  by  far  the  productive  capacity  of  their  own 
land.  The  population  of  Prussia  would  double  itself  by 
natural  increase  in  49.2  years;  that  of  England  in  59.1 
years;  that  of  Italy  in  65.7  years;  that  of  Austria  in  74.1; 
and — though  the  population  of  France  lags  behind — even 
there  in  a  period  of  591  years  a  similar  increase  would 
result.1 

Evidently  a  constantly  increasing  pressure  on  the  means 
of  subsistence  must  follow  in  all  nations ;  nor  is  the  pressure 
upon  the  other  European  states  relieved,  nor  the  colonial 
or  military  rivalry  lessened,  by  the  slow  rate  of  increase 
in  a  single  nation.  By  a  paradox,  the  political  effects  of  a 
rising  birth  rate  in  Germany  and  a  falling  birth  rate  in 
France  have  been  precisely  the  same;  for  Germany,  like 
every  other  European  Power,  has  believed  herself  compelled 
to  seek  an  outlet  for  population  in  a  world  empire;  and 
France  has  been  forced  to  look  to  new  colonies  for  the  native 
troops  with  which  to  meet  the  long-expected  onslaught  of 

1  A.  Newsholme:  The  Elements  of  Vital  Statistics,  p.  15.  Professor  F.  W. 
Taussig  gives  slightly  different  figures:  59  years  for  England  and  Wales;  65 
years  for  Italy;  but  990  years  for  France.  (Principles  of  Economics,  vol. 
ii:  p.  215.) 


16  The  Economic  Causes  of  Modern  War 

her  more  fecund  neighbor.1  In  each  case  the  practical 
result  has  been  identical — a  demand  for  colonies,  conse- 
quent rivalry  with  other  Powers  having  the  same  ends  in 
view,  jealousy,  and  friction  because  the  lands  available 
for  European  colonization  are  limited. 

The  German  efforts  to  build  up  a  world  empire  during  the 
latter  part  of  the  Nineteenth  and  the  first  part  of  the 
Twentieth  Centuries  offer  the  clearest  example  of  the  forces 
which  have  been  at  work  throughout  Europe  generally, — 
though  not  everywhere  so  clearly. 

The  characteristic  fecundity  of  the  Teuton  has  been  one 
of  the  most  important  causes  of  the  German  demand  for 
colonial  expansion.  Although  the  German  birth  rate  has 
been  falling  since  1876  when  it  stood  at  41.0  per  1,000  of 
the  population  of  the  whole  Empire,  the  death  rate  has 
been  falling,  too ;  and  this,  together  with  state  and  municipal 
efforts  to  check  infant  mortality  has  kept  the  population 
constantly  increasing.  Within  a  hundred  years  it  has 
tripled,  and  6,000,000  Germans  have  come  to  the  United 
States  alone. 

The  following  table  for  the  decades  preceding  and  fol- 
lowing the  establishment  of  the  Empire,  shows  not  only  the 
rise  and  fall  of  the  birth  rate,  but  also  the  maintenance  of 
a  rate  always  sufficiently  high  to  indicate  a  growth  in 
population : 2 

1851-1860 35.3  per  1000  inhabitants 

1861-1870 37.2  " 

1871-1880 39.1  " 

1881-1890 36.8     "       " 

1891-1900 36.2     " 

1  The  ratio  between  the  two  populations  is  given  by  Dr.  E.  J.  DilloD  as 
standing  at  present  at  about  6:4  and  advancing  perceptibly  to  7:4.  (The 
Inside  Story  of  the  Peace  Conference,  p.  422.) 

3W.  H.  Dawson:  Evolution  oj  Modern  Germany,  p.  309. 


The  Economic  Motives  of  Colonial  Rivalry         17 

The  compensation  which  the  rapidly  falling  death  rate 
offered  for  the  more  slowly  falling  birth  rate,  and  the  con- 
sequent maintenance  of  the  population  increase  at  more 
than  its  old  rate,  may  even  more  clearly  be  seen  from  the 
following  table  of  the  years  between  1870  and  1905:  x 

Year  Population  Increase  Per  Cent. 

1870  40,818,000                       ***  *** 

1875  42,729,000  1,911,000  4.7 

1880  45,236,000  2,507,000  5.9 

1885  46,858,000  1,622,000  3.6 

1890  49,42S,000  2,570,000  5.5 

1895  52,280,000  2,852,000  5.8 

1900  56.367,000  4,087,000  7.8 

1905  60,641,000  4,274,000  7.6 

It  is  evident  that  sooner  or  later  a  nation  faced  by  such 
a  situation  must  either  submit  to  losses  of  its  citizens  by 
emigration  to  less  thickly  settled  lands,  and  to  their  eventual 
absorption  by  the  newer  country;  or  else  it  must  expand 
its  own  territories  by  colonization. 

It  is  not  Germany  alone  which  has  faced  a  similar  condi- 
tion. Continuing  and  increasing  pressure  of  population  is 
readily  apparent  in  the  following  table  of  the  yearly  aver- 
ages of  the  excess  of  births  over  deaths,  which  indicates 
essentially  similar  population  problems  in  the  four  principal 
European  states:  2 

Germany  Great  Britain  Italy  France 

1861-1870 408,333               365,499  183,196  93,515 

1871-1880 511,034                431,436  191,538  64,063 

1881-1890 551,308                442,112  307,082  66,982 

1891-1900 730,265                430,000  339,409  23,961 

1901-1910 866,338                484,822  369,959  46,524 

Great  Britain,  with  its  beggarly  120,000  square  miles  of 

1W.  H.  Dawson:   Evolution  of  Modern  Germany,  p.  336. 
aE.  J.  Dillon:  Inside  Story  of  the  Peace  Conference,  p.  428.    The  data 
are  derived  from  U Information. 


18  The  Economic  Causes  of  Modern  War 

land,  could  scarce  afford  standing  room  for  all  the  men  of 
English  blood  who  have  gone  out  to  people  a  quarter  of  the 
globe.  Japan,  already  overcrowded,  is  obeying  the  inevitable 
impulse  to  expansion,  and  even  the  United  States — as  yet 
hardly  aware  of  the  existence  of  a  population  problem — is 
sending  emigrants  from  its  territory  with  a  population 
density  of  30  to  the  square  mile  to  the  farm  lands  of 
Canada  where  the  density  is  only  two  persons  to  the  square 
mile.1 

Overpopulation,  by  the  stern  logic  of  necessity,  presents 
the  modern  state  with  the  alternative  either  of  seeing  some 
of  its  best  blood  absorbed  in  other  less  populous  lands  and 
forever  lost  to  it,  or  else  of  founding  colonies  in  which  the 
emigrants  crowded  out  of  the  homeland  may  settle  to  build 
up  a  new  part  of  the  mother  country,  maintaining  the  old 
traditions  and  customs,  forming  a  part  of  the  political  organ- 
ization, and  opening  new  markets  for  the  output  of  the 
industries  of  the  older  state. 

For  there  is  a  second  motive,  resulting  from  the  increase 
in  population,  for  the  scramble  after  colonies  among  the 
great  Powers  in  the  last  fifty  years.  An  overpopulated 
state  cannot  be  agricultural;  it  must  turn  to  industry,  and 
no  state  which  is  predominately  industrial  can  hope  to  find 
a  market  within  its  own  frontiers  for  all  the  goods  that  it 
produces.  Its  own  citizens  cannot  consume,  or  cannot  afford 
to  consume,  all  that  they  make.  The  business  men  of  such 
a  state,  finding  their  products  going  begging  at  home,  seek 
for  markets  abroad,  and  invariably,  not  content  with  sales 
in  foreign  countries  which  are  too  often  hopelessly  hindered 
by  tariff  regulation,  they  demand  the  establishment  of 
colonies  as  outlets  for  their  wares. 

Such  is  the  condition  which  has  arisen  out  of  the  gradual 

1  Contrast  this  with  780  to  the  square  mile  in  Saxony,  659  in  Belgium, 
474  in  Holland. 


The  Economic  Motives  of  Colonial  Rivalry         19 

transformation  of  a  great  part  of  Europe  into  an  industrial 
region,  a  transformation  which  has  itself  grown,  in  part 
at  least,  out  of  the  increase  of  population.  The  increase  of 
German  population  and  the  development  of  German  indus- 
trialism have  gone  hand  in  hand  with  a  decrease  of  German 
agriculture,  since  an  agricultural  country  cannot  be  densely 
populated.  When  a  people  exceed  a  certain  number,  they 
must  turn  to  the  close  living  of  an  industrial  community 
in  order  to  exist,  which  means  that  they  must  produce  far 
more  than  their  factories  have  made  before,  and  that  they 
must  consequently  exceed  their  own  capacity  to  use. 

There  arises  in  this  way  an  industrial  state  of  the  modern 
type,  with  an  increasing  population  and  a  decreasing  do- 
mestic food  supply,  a  state  which  must  perforce  look  outside 
its  own  boundaries  for  its  raw  materials  and  its  markets, 
and  which  must  find  them  lest  it  starve.1  For  only  in  ex- 
change for  products  sold  abroad  can  it  obtain  the  food  which 
it  must  have  to  feed  its  people. 

The  dire  straits  to  which  Holland,  although  a  neutral 
country,  was  reduced  during  the  war,  through  the  closing 
of  lines  of  transportation,  shutting  her  off  from  markets 
previously  open,  vividly  illustrates  the  common  European 
situation.  Although  the  rich  black  soil  of  the  country  had 
at  one  time  sufficed  for  the  needs  of  the  Dutch  citizens, 
they,  like  other  European  nations,  had  come  to  be  depend- 
ent on  outside  sources  of  supply  when  the  war  broke  out. 

These  sources,  one  by  one,  were  closed,  more  gradually 
than  in  the  case  of  the  belligerent  states,  but  none  the  less 
actually  and  in  some  respects  even  more  completely.     In 

1 M.  Maurice  Ajam,  head  of  the  Comite  de  Commerce  Francais  avec 
l'AUemagne,  while  in  Germany  in  September,  1913,  summed  up  the  situa- 
tion in  a  single  sentence  shorter  than  this  one  of  my  own:  "Si  l'AUemagne 
n'exporte  pas,  elle  meurt."  Ajam:  Probleme  Economique  Franco-Alle- 
mande,  p.  25. 


20  The  Economic  Causes  of  Modern  War 

1918,  moved  by  the  menace  of  the  submarine,  the  Dutch 
began  to  raise  wheat.  In  one  week  the  government  slaugh- 
tered 50,000  cattle  to  keep  them  from  starving,  for  there 
was  no  more  fodder.  If  Holland  raises  wheat  she  must 
import  fodder;  if  she  raises  fodder,  she  must  import  wheat, 
for  her  land  is  limited  in  area.  It  was  difficult  or  impossible 
under  war  conditions  to  import  either,  and  as  a  result  of 
the  slaughter  of  the  cattle,  the  people  lived  for  eighteen 
months  practically  without  meat,  upon  an  allowance  of 
one-half  pound  of  fat  in  ten  days,  one-tenth  of  a  litre  of 
milk  a  day,  two  pounds  of  bread  in  five  days.  The  bread 
was  made  of  potatoes,  beans,  peas,  linseed — anything  that 
was  to  be  had  as  a  wheat  substitute.  Consumption  and 
dysentery  ravaged  the  population,  weakened  physically 
from  the  food  shortage;  and  in  the  last  months  of  the  war 
famine  was  a  reality. 

Yet  Holland  had  always  been  accounted  a  rich  and  pros- 
perous country.  It  was  both  rich  and  prosperous  in  1914; 
but  it  was  not  economically  self-sufficing.  It  suffered  be- 
cause it  relied  on  outside  sources  of  food  supply. 

But  the  industrial  state — and  every  great  Power  in 
Europe  is  an  industrial  state  in  this  sense — must  look  beyond 
its  boundaries  not  only  for  the  food  that  feeds  its  citizens, 
but  also  for  the  food  that  feeds  its  mills.  There  is  not  a 
state  in  Europe  that  does  not  look  beyond  its  own  borders 
for  food,  raw  materials,  and  markets — in  spite  of  the  brave 
attempts  made  by  Germany  to  be  economically  self-suffic- 
ing during  the  war. 

Such  a  state  must  find  raw  materials,  ore,  lumber,  dye 
stuffs,  all  that  it  uses  in  its  industries.  If  it  cannot  get 
these  commodities,  its  mills  must  cease  to  operate,  its  work- 
ers lie  idle,  and  domestic  disaster  result. 

A  perfect  example  of  this  state  of  affairs  may  be  seen  in 
the  German  Empire  at  the  outbreak  of  the  war.    Being  a 


The  Economic  Motives  of  Colonial  Rivalry         21 

manufacturing  state,  Germany  required  immense  quanti- 
ties of  lumber,  cotton,  wool,  silk,  copper,  platinum,  mercury, 
manganese,  aluminum,  sulphur,  and  other  raw  materials, 
only  a  few  of  which  could  be  found  at  all,  and  none  in  suffi- 
cient quantities,  within  her  borders.  Being  a  manufactur- 
ing state,  hence  a  state  rapidly  ceasing  to  be  agricultural,  she 
required  also  foodstuffs  adequate  to  the  support  of  a  popu- 
lation which  the  national  fecundity  was  causing  to  increase 
constantly.  She  produced  large  quantities  of  coal.  Iron, 
thanks  to  the  annexation  of  the  French  provinces,  she  could 
supply  in  quantity  almost  sufficient  for  her  needs;  but  the 
growth  of  German  industry,  unless  the  productivity  of  the 
mines  kept  pace  with  it,  would  in  the  end  make  difficulty 
even  here. 

The  statistics  of  import  and  export  for  the  two  years 
immediately  preceding  the  outbreak  of  the  war,  serve  best 
to  show  exactly  what  was  happening: 

In  millions  of  marks : 1 

Imports                    1912  1913  Exports                    1912  1913 

Raw   cotton 579.8  607.1  Machinery  and  parts. 630.3  680.3 

Wheat    395.8  417.3  Iron  and  iron  goods ..  580.9  652.2 

Raw   wool    405.9  412.7     Coals    436.6  516.4 

Barley    444.2  390.4     Cotton  goods 421.6  446.5 

Copper    313.0  335.3     Woollen  goods   253.4  270.9 

In  other  words,  Germany  was  unable  to  produce  her  own 
raw  materials,  and  had  to  look  abroad  for  the  raw  cotton  and 
wool  for  her  textile  industries;  but  was  able  to  export  the 
same  commodities,  manufactured,  at  a  figure  in  excess  of 
the  value  of  the  imports  (representing,  of  course,  the  labor 
of  skilled  mechanics),  even  after  the  needs  of  the  domestic 
population  had  been  satisfied.  It  is  also  significant  to  note 
that  Germany  did  not  export  any  food  products,  except 
refined  sugar ;  and  one  may  perhaps  pause  to  reflect  that  the 

1  Statesman's  Yearbook,  1916,  p.  957. 


22  The  Economic  Causes  of  Modern  War 

"iron  goods"  of  which  more  than  600,000,000  marks  were 
exported  in  1913,  included,  among  other  products,  Krupps' 
armor  plate  and  artillery. 

The  vast  disproportion  existing  between  the  export  and 
the  import  of  foodstuffs  is  to  be  seen  with  equal  plainness 
in  the  same  years.  Thus,  in  1912,  the  importations  of 
agricultural  products  and  foodstuffs  in  general  were  7,100,- 
262,000  marks  and  in  1913  they  were  7,036,738,000.  As 
against  this,  the  exports  of  the  same  commodities  for  the 
same  years  were  1,475,087,000  and  1,728,157,000  marks 
respectively.1  Germany  was,  in  other  words,  a  state  com- 
pletely dependent  upon  other  states  for  the  raw  materials 
in  her  most  important  industries,  and  for  almost  all  the 
food  of  a  population  which  averages  310  to  the  square  mile. 

A  great  part  of  these  imports,  interference  with  which 
would  strike  at  the  very  life  of  industry  and  so  at  the  life 
of  the  nation  itself,  came  by  sea — by  the  sea  which  was  con- 
trolled by  the  chief  commercial  rival  of  the  empire.  At  any 
time  the  British  fleet  could  have  stopped  German  industry. 
Until  the  war  broke  out  in  1914  and  the  blockade  shut  down, 
it  did  not  do  so;  but  the  industrial  chiefs  of  the  German 
Empire,  working  night  and  day  to  force  their  way  into 
British  markets  and  win  them  for  their  own,  cast  anxious 
eyes  across  the  North  Sea  at  the  great  fleet  that  waited, 
waited. 

Germany's  difficulties  were  not  peculiarly  her  own,  for 
in  precisely  similar  fashion  the  United  Kingdom  itself  is 
dependent  upon  imports  for  the  maintenance  of  the  indus- 
trial system.  Cut  off  from  importation — as  Germany  tried 
to  leave  her  through  the  submarine  campaign — the  indus- 
tries of  Great  Britain  would  be  paralyzed  while  British 

1  Statesman's  Yearbook,  1915,  p.  950. 


The  Economic  Motives  of  Colonial  Rivalry         23 

workers  starved.  Raw  materials  and  food  alike  must  come  to 
Britain  from  the  lands  beyond  the  sea.  Upon  the  supply  of 
cotton  from  America  depends  the  prosperity  of  the  great 
Lancashire  textile  mills.  For  iron,  silk,  wool,  cotton,  lum- 
ber, and,  most  of  all,  for  foodstuffs,  Great  Britain,  like  her 
enemy,  had  to  turn  to  other  lands. 

Contrast  of  the  imports  and  exports  of  foodstuffs  and 
raw  materials,  revealing  the  enormous  excess  of  the  former, 
demonstrates  the  total  dependence  of  the  population  of 
the  United  Kingdom  on  external  sources  of  supply,  and 
their  helplessness  the  instant  the  lines  of  communication  are 
cut.  The  excess  of  the  imports  of  foodstuffs  and  raw 
materials  over  exports,  and  the  corresponding  excess  of  the 
exports  of  manufactures  over  imports,  both  show  the  entire 
dependence  of  an  industrial  state  upon  the  world  outside, 
whether  for  food,  raw  materials,  or  markets  for  manu- 
factures.   The  following  table  makes  this  clear :  1 

In  thousands  oj  pounds  sterling: 

Imports  Exports 

1914  1915  1914  1915 

Food,   drink    and   tobacco    296,969        381,901  44,390  47,380 

Raw  materials    236,532        287,341  110,571        106,929 

Manufactured  articles   160,490        181,515  362,723        314,569 

The  condition  of  France  as  regards  imports  and  exports 
is  essentially  the  same.  The  former  are  mainly  food  and 
raw  materials;  the  latter  primarily  manufactured  goods. 
The  Republic  is  compelled  to  rely  almost  entirely  upon 
other  states  for  the  supplies  upon  which  her  population 
and  her  industry  depend.  The  figures  of  import  and  export 
of  food,  raw  materials,  and  manufactures  differ  only  in 
detail  from  those  of  Great  Britain  and  Germany.  The 
basic  problem  is  identical  with  that  of  other  European 
Powers.    Statistics  for  1912  and  1913,  the  two  years  imme- 

1  Statesman's  Yearbook,  1916,  p.  80. 


24 


The  Economic  Causes  of  Modern  War 


diately  preceding  the  World  War,  illustrate  a  situation  long 
existent:  * 


In  millions  of  francs: 

Imports 
1912     1913 

Food   products    72  76 

Raw   materials    193        197 

Manufactured  goods  . .  64         67 


Exports 
1912     191S 

Food  products  33         33 

Raw  materials 77  75 

Manufactured  goods   . .  138        144 


The  most  important  commodities  involved  are:1 


In  millions  of  francs: 

Imports 

1912  1913 

Cereals    366.8  613.4 

Wool    684.6  698.8 

Raw  silk   319.1  317.3 

Raw  cotton   567.1  541.2 

Hides  and  furs   222.3  233.5 

Coal    and   coke    501.4  575.2 


Exports 

1912 

1913 

Textiles    (wool)    . . 

. . .  190.7 

211.3 

Textiles    (silk)    ... 

...292.3 

374.7 

Textiles  (cotton)    . 

...384.7 

367.4 

Skins  and  furs   . . . 

. .  .321.2 

315.7 

Automobiles     

...207.1 

217.5 

Raw  wool   

...362.5 

294.2 

In  an  even  worse  plight  is  Italy,  a  state  which,  with  a 
grave  population  problem  and  with  large  industries  still 
capable  of  great  development,  is  totally  dependent  on 
foreign  sources  for  such  indispensable  commodities  as  iron, 
coal,  and  cotton.  Precisely  as  in  the  case  of  Germany,  Eng- 
land, and  France,  Italy  is  dependent,  for  the  continuance  of 
industry  and  for  feeding  her  civilian  population,  upon  the 
keeping  open  of  lines  of  transportation,  which  includes  the 
sea  lanes  by  which  the  greater  part  of  her  imports  come  to 
her,  and  by  which  her  exports  reach  their  markets. 

The  economic  difficulties  of  Europe  are  not  confined  to 
that  continent.  Step  by  step  they  have  followed  the  adop- 
tion of  western  modes  of  life  in  the  island  Empire  of  Japan. 
Like  European  states,  Japan  has  swiftly  come  to  feel  her 
boundaries  binding  her  too  closely,  and  the  same  series  of 


1  Statesman's   Yearbook,  1914,  p.  835. 


The  Economic  Motives  of  Colonial  Rivalry         25 

causes  have  been  at  work  in  the  east  as  in  the  west — the 
more  clearly  because  of  the  brevity  of  the  period  within 
which  these  changes  have  come  about. 

The  population  of  Japan  has  increased  very  rapidly,  and 
is  growing  today  at  the  rate  of  nearly  600,000  a  year. 
Estimates  fix  the  number  of  Japanese  in  1828  as  27,200,000. 
The  population  is  known  to  have  been  34,000,000  in  1875, 
and  in  1903,  including  Formosa  and  the  Pescadores, 
50,000,000.*  The  density  is  387  per  square  mile,  only  a  little 
less  than  that  of  Great  Britain,  and  the  rate  of  increase  is 
34.2  per  thousand,  or  40  per  cent,  higher  than  that  of  Great 
Britain  and  very  nearly  that  of  the  German  Empire,  to 
which  in  many  respects  Japan  presents  a  close  analogy.2 
The  strides  in  population  have  gone  on  far  more  rapidly  in 
the  urban  manufacturing  centres  than  in  the  agricultural 
districts. 

Such  a  growth  of  population  must  inevitably  tax  the 
capacity  of  any  land,  but  the  limit  has  been  reached  sooner 
in  Japan  than  in  Europe,  because  the  islands  of  the  Empire 
contain  so  little  arable  land.  Allowing  for  the  greatest 
possible  agricultural  extension,  fully  80  per  cent,  of  the 
whole  area  is  such  that  it  can  never  be  tilled 3  and  the  per 
capita  share  of  land  suitable  for  cultivation  is  but  one- 
half  acre  to  each  citizen.4    It  is  small  wonder,  then,  that  it 

1  These  figures  are  from  K.  Asakawa:  The  Russo-Japanese  Conflict,  p. 
2.  They  are  largely  based  on  the  Fourth  Financial  and  Economical  Annual 
of  Japan,  1904,  published  by  the  Department  of  Finance. 

aSee  R.  P.  Porter:  Japan,  the  Rise  of  a  Modern  Power,  p.  272,  whose 
figures  are  based  on  the  1913  census. 

3  R.  P.  Porter:  Japan,  the  Rise  of  a  Modern  Power,  p.  269. 

4  These  and  the  following  figures  are  from  K.  Asakawa :  The  Russo- 
Japanese  Conflict,  pp.  3-5.  They  are  derived  from  articles  in  the  Koku- 
min  Shimbun  {National  News),  February  5,  10,  19,  1904,  the  Toyo 
Keizai  Shimpo  (Oriental  Economist),  May  5,  1903,  pp.  17-19,  and  the 
Twentieth  Century,  pp.  119  ff.  For  the  sake  of  convenience,  I  have  re- 
duced them  all  to  bushels,  with  the  ratio,  1  koku  =  4.9629  bushels. 


26  The  Economic  Causes  of  Modern  War 

has  been  necessary  for  the  new  industrial  state  to  begin  to 
look  abroad  for  food  supplies,  precisely  as  the  states  of 
Europe  have  been  constrained  to  do. 

Rice  is  the  staple  article  of  diet  of  the  people,  who  of 
course  differ  in  their  needs  differ  in  some  respects  from 
Europeans.  In  1877  the  production  had  been  132,013,000 
bushels,  but  as  the  need  for  more  food  was  felt,  it  was  made 
possible,  mainly  through  improved  methods  of  cultivation, 
and  with  a  land  increase  of  only  465,000  acres,  to  raise  this 
to  210,000,000  bushels  in  1903.  In  the  same  period  the  pro- 
duction of  barley,  rye,  and  wheat  (known  collectively  as 
mugi)  rose  from  47,644,000  bushels  to  94,295,000  bushels. 
But  little  more  land  was  available,  and  although  the  pains- 
taking Japanese  farmers  were  getting  all  that  could  be  wrung 
from  the  paddy  fields,  the  state  already  was  forced  to  import 
both  rice  and  mugi,  for  consumption  already  far  exceeded 
production.  Asakawa's  estimates  place  the  annual  con- 
sumption of  rice  in  1903  at  about  228,300,000  bushels,  and 
of  mugi  at  about  106,700,000. 

How  thoroughly  the  Mikado's  people  were  becoming  de- 
pendent on  external  sources  of  supply  for  a  variety  of  com- 
modities may  be  seen  from  the  following  table  of  the  im- 
ports of  food  and  raw  materials:1 

In  yen:  m2  m3 

Cotton    79,784,772  69,517,894 

Wool     3,397,564  4,811,811 

Rice     17,750,817  51,960,033 

Wheat     240,050  4,767,832 

Flour     3,278,324  10,324,415 

Beans    4,956,000  7,993,411 

Oil-cakes  10,121,712  10,739,359 

Japanese  imports  today  are,  like  those  of  European  states, 
mainly  food  and  raw  materials,  and  the  exports  very  largely 

lK  Asakawa:   The  Russo-Japanese  Conflict,  p.  9.     1  yen  =  $.4984. 


The  Economic  Motives  of  Colonial  Rivalry         27 


manufactures,  although  silk,  tea,  and  copper  offer  excep- 
tions. The  latest  information  available  is  contained  in  the 
following  table:  * 


In  thousands  of  yen: 

Imports 

1918        1919 

Raw  cotton   515,559  667,867 

Rice    89,776  162,220 

Wool    60,146      61,304 

Iron    204,789  156,579 

Sugar    34,244      58,184 

Oil-cakes   92,255  135,189 

Beans  and  peas  ....  20,396      35,213 


Exports 
1918       1919 

Cotton   manuf 396,213  394,294 

Raw  silk  370,337  623,919 

Silk  manuf 70,178  101,539 

Matches    27,743      32,968 

Refined  sugar   23,252      21,627 

Tea   23,058      18,402 

Copper     37,749      19,647 


As  in  Europe,  so  in  Japan,  a  population  which  was 
speedily  coming  to  be  purely  industrial,  could  live  only  by 
importing  its  foodstuffs  and  raw  materials,  paying  for  them 
with  its  manufactures.  Foreign  trade  had  grown  between 
1873  and  1903  from  49,742,831  yen  to  606,637,959  yen,  and 
even  in  1903,  84.6  per  cent,  of  this  trade  consisted  of  manu- 
factured articles.2  In  1919 British  calculations  gave  a  total 
foreign  trade  of  427,219,194  pounds  sterling.3 

For  these  three  reasons,  then,  a  great  modern  state  must 
possess  colonies:  to  provide  room  for  overflow  of  popula- 
tion within  the  national  area;  to  bring  under  the  national 
flag  the  sources  of  foodstuffs  and  raw  materials;  and  to 
provide  markets  for  the  manufactures  of  the  parent  state. 
The  United  States,  to  be  sure,  furnishes  an  apparent  excep- 
tion to  this  rule.  Our  tradition  is  anti-imperialistic.  We 
are  without  an  empire  and  we  do  not  at  present 4  desire  to 

1  Statesman's   Yearbook,   1920,  p.   1028. 

aK.  Asakawa:  The  Russo-Japanese  Conflict,  pp.  2-3. 

'  Statesman's  Yearbook,  1920,  p.  1027. 

*The  possession  of  the  Panama  Canal  has  led  the  United  States  into  a 
course  of  action  which  may  prove  the  germ  of  an  imperialistic  policy  in 
the  Caribbean  Sea.  Rear-Admiral  Colby  N.  Chester,  U.S.N.,  has  char- 
acterized these  waters  and  the  Gulf  of  Mexico  as  "the  larger  Panama  Canal 
Zone."    American  influence  is  paramount  in  Cuba;  Porto  Rico  has  been 


28  The  Economic  Causes  of  Modern  War 

possess  one ;  but  this  is  merely  the  attitude  of  a  new  people 
in  a  vast  and  as  yet  only  partially  developed  country,  where 
the  pressure  of  population  has  scarcely  begun  to  make  itself 
felt,  where  the  phenomenon  of  production  beyond  domestic 
needs  has  barely  appeared,  and  where  our  immense  wealth 
in  natural  resources  leaves  us  largely  untouched  by  the 
problem  of  raw  materials  and  food  supplies. 

To  the  states  of  Europe,  however,  these  problems  are  ever- 
present.  They  require  new  lands  where  their  citizens, 
crowded  out  at  home  by  the  growth  of  the  population,  may 
settle,  where  new  markets  and  new  supplies  of  raw  materials 
for  the  industries,  and  of  foodstuffs  for  the  people,  of  the 
fatherland,  may  be  found.  That  their  citizens  should 
emigrate  to  other  lands  and  be  permanently  lost  to  them 
is  intolerable;  and  even  though  markets,  raw  materials, 
and  foodstuffs  might  all  be  found  in  the  territories  of  other 
nations  (usually  hedged  about  with  tariff  restrictions), 
none  the  less  each  state,  facing  the  perpetual  possibility  of 
war,  wishes  to  be  economically  self-sufficient  within  its 
own  dominions. 

Colonies  they  had  to  have;  colonies  they  came  to  possess; 
and,  once  obtained,  the  colonies  with  the  routes  that  led 
to  them  had  to  be  defended.  Out  of  this  sprang  the  com- 
petition in  military  and  naval  armaments;  and  the  effort 
to  construct  great  fleets  necessarily  involved  a  scramble  for 
naval  bases  and  strategic  points  only  a  shade  less  undigni- 
fied than  that  for  colonies. 

South  America,  Asia,  and  Africa  were  the  undeveloped 

annexed;  the  Virgin  Islands  purchased  from  Denmark;  the  Canal  Zone 
leased  from  the  Republic  of  Panama;  Fonseca  Bay  leased  for  99  years 
from  Nicaragua ;  and  administrative  or  financial  supervision  begun  over 
the  Dominican  Republic  and  Haiti.  See  J.  H.  Latane;  From  Isolation  to 
Leadership,  pp.  132-133,  and  Admiral  Chester's  address,  "The  Present 
Status  of  the  Monroe  Doctrine,"  in  the  Annals  oj  the  American  Academy 
of  Political  and  Social  Science,  54:20-27,  Jy.,  '14. 


The  Economic  Motives  of  Colonial  Rivalry         29 

lands  that  could  be  exploited.  American  pride  leads  us  to 
believe  that  it  is  our  veto  upon  further  colonization  in 
South  America,  expressed  in  the  Monroe  Doctrine,  that 
has  prevented  European  expansion  there;  but  it  is  at  least 
significant  to  note  that  upon  each  of  the  three  occasions 
when  the  Doctrine  has  been  tested,  the  European  Balance 
of  Power  has  operated  to  uphold  it  and  to  prevent  the  seiz- 
ure of  territory  or  the  establishment  of  a  recognized  "sphere 
of  influence."  1    Whether  because  of  the  Monroe  Doctrine 

"The  three  chief  tests  of  the  doctrine  have  been:  1.  The  French  in- 
vasion oj  Mexico,  1861-1866.  Designed  to  place  Maximilian  on  the  throne, 
the  attempt  ended  in  the  withdrawal  of  the  French  troops  supporting 
the  ill-fated  Empire,  under  the  combined  influence  of  American  threats 
and  Napoleon  Ill's  fear  of  the  rising  power  of  Prussia,  which  crushed 
Denmark  in  1864  and  Austria  in  1866.  American  representations  were  by- 
no  means  to  be  neglected  at  this  time,  however,  since  the  United  States 
had  at  its  disposal,  after  the  collapse  of  the  Confederacy,  a  large  and 
well-trained    army. 

2.  The  Venezuelan  boundary  controversy  with  Great  Britain  in  1895. 
Great  Britain  yielded  her  claim  to  extend  the  Guiana  boundary  at  the 
expense  of  Venezuela,  but  three  dates  make  her  motives  fairly  clear. 
President  Cleveland's  Message  to  Congress  on  this  subject  was  trans- 
mitted December  17,  1895.  The  Jameson  Raid  in  the  Transvaal  occurred 
December  29,  and  the  famous  telegram  of  sympathy  from  the  German 
Kaiser  to  President  Kruger  was  sent  January  3,  1896. 

3.  The  blockade  of  Venezuela  by  Great  Britain,  Italy,  and  Germany. 
This  has  been  regarded  as  a  ballon  d'essai  on  the  part  of  Germany,  with 
a  view  to  subsequent  colonization  in  South  America  if  the  United 
States  failed  to  stand  firm  in  support  of  the  Monroe  Doctrine.  When, 
however,  Italy  and  Great  Britain  withdrew  and  accepted  arbitration  of 
their  claims,  the  British  navy  stood  behind  the  Doctrine. 

Professor  J.  H.  Latane's  comment  on  the  role  of  the  European  Balance 
of  Power  in  maintaining  the  Monroe  Doctrine  is  applicable  here:  "While 
England  has  from  time  to  time  objected  to  some  of  the  corollaries  de- 
duced from  the  Monroe  Doctrine,  she  has  on  the  whole  been  not  unfa- 
vorably disposed  toward  the  essential  features  of  the  policy.  The  reason 
for  this  is  that  the  Monroe  Doctrine  has  been  an  open-door  policy  and 
has  thus  been  in  general  accord  with  the  British  policy  of  free  trade. 
The  United  States  has  not  used  the  Monroe  Doctrine  for  the  establish- 
ment of  exclusive  trade  relations  with  our  southern  neighbors.  .  .  .  There 
has,  therefore,  been  little  rivalry  between  the  United  States  and  the 
Powers  of  Europe   in  the  field  of  South  American  commerce.    Our  in- 


30  The  Economic  Causes  of  Modern  War 

or  because  of  the  mutual  jealousy  among  the  European 
Powers,  or  because  of  the  strength  of  the  British  navy,  the 
fact  remains  that  the  further  acquisition  of  territory  in  the 
Americas  by  European  states  has  been  blocked  since  the 
announcement  of  the  Doctrine  by  President  Monroe  in 
1823. 

Only  Asia  and  Africa,  then,  lay  open  to  the  colonizing 
powers,  and  in  both  continents  the  lands  of  the  native  states 
have  been  gobbled  up  mercilessly,  on  the  flimsiest  pretexts 
and  seldom  with  any  real  justification  of  the  high-sounding 
talk  of  "vital  interests,"  "spheres  of  influence,"  "the  advance 
of  civilization,"  and  "the  white  man's  burden." 

But  if  colonies  are  to  furnish  an  outlet  for  a  surplus  popu- 
lation and  for  surplus  manufactures,  if  they  are  to  supply 
the  mother  country  with  the  raw  materials  necessary  to 
her  industries,  the  trade  routes  leading  to  them  must  be 
free  at  all  times.  Great  Britain,  the  first  in  the  modern 
colonial  field  had  seen  this  before  the  rest  of  the  European 
states,  and  with  a  powerful  fleet,  with  her  troops  safely 
ensconced  in  half  the  strategical  locations  of  the  earth,  and 
with  commanding  positions  on  all  the  trade  routes  to  her 
most  important  colony,  India,  she  possessed  the  command 
over  the  sea  lanes  of  which  the  other  powers  more  and  more 
came  to  feel  the  need. 

terest  has  been  political  rather  than  commercial.  We  have  prevented 
the  establishment  of  spheres  of  influence  and  preserved  the  open  door. 
This  situation  has  been  in  full  accord  with  British  policy.  Had  Great 
Britain  adopted  a  high  tariff  policy  and  been  compelled  to  demand  com- 
mercial concessions  from  Latin-America  by  force,  the  Monroe  Doctrine 
would  long  since  have  gone  by  the  board  and  been  forgotten.  Americans 
should  not  forget  the  fact,  moreover,  that  at  any  time  during  the  past 
twenty  years  Great  Britain  could  have  settled  all  her  outstanding  dif- 
ficulties with  Germany  by  agreeing  to  sacrifice  the  Monroe  Doctrine  and 
give  her  rival  a  free  hand  in  South  America.  In  the  face  of  such  a  com- 
bination our  navy  would  have  been  of  little  avail.  .  .  ." — J.  H.  Latane: 
From  Isolation  to  Leadership,  pp.  52-53. 


The  Economic  Motives  of  Colonial  Rivalry         31 

With  the  exception  of  the  Kiel  and  Panama  Canals,  there 
is  not  a  strategic  point  upon  the  trade  routes  of  the  world 
that  Great  Britain  does  not  control;  and  today  the  German 
dominance  over  the  former  has  been  ended,  while  the 
foreign  policy  of  the  United  States  is  such  that  the  Ameri- 
can ownership  of  the  Panama  Canal  is  an  adequate  guar- 
anty of  the  safety  of  British  trade  without  putting  the 
Empire  to  the  trouble  of  controlling  it. 

The  best  single  instance  of  the  importance  to  modern 
industrial  nations  of  trade  routes  in  general,  and  of  the 
command  of  the  approaches  to  rich  colonies  in  particular,  is 
to  be  seen  in  the  British  policy  of  winning  every  one  of 
the  approaches  to  India,  Throughout  the  entire  Nine- 
teenth Century  and  until  their  design  was  accomplished  in 
the  Twentieth,  British  diplomats  have  bent  every  effort 
towards  securing  the  points  of  dominance  along  every 
possible  avenue  leading  to  the  Indian  Empire,  whether  on 
land  or  sea,  The  policy  may  have  been  to  a  degree  uncon- 
scious in  the  statesmen  who  initiated  it;  but  in  later  stages 
its  objects  have  been  defined  with  perfect  clearness,  until 
in  the  first  twenty  years  of  the  present  century  the  work  of 
over  a  hundred  years  was  brought  to  completion.  The  last 
and  frankest  statement  of  this  century-long  effort  of  Great 
Britain  was  made  by  Winston  Spencer  Churchill,  in  an 
interview  given  to  an  American  journalist  during  the  war: 

"History  will  vindicate  the  Dardanelles  expedition.  It  was 
planned  with  the  sole  idea  of  cutting  and  keeping  closed  the  Ger- 
man road  to  India."  1 

Because  of  India,  Great  Britain  made  war  on  Napoleon 
in  the  Mediterranean,  in  Egypt,  and  in  Syria.  When  Mo- 
hammed Ali  set  out  from  Egypt  to  overthrow  the  Ottoman 

1  Isaac  F.  Marcosson :  Adventures  in  Interviewing,  p.  154. 


32  The  Economic  Causes  of  Modern  War 

Empire,  he  found  a  British  army  confronting  him  in  Syria, 
just  as  Napoleon  had,  and  for  the  same  reason — to  prevent 
any  threat  to  the  safety  of  the  Indian  Empire  which  is 
economically  all-important  to  Britain.  At  the  Congress  of 
Berlin  the  English  asked  only  for  the  possession  of  certain 
of  the  approaches  to  India — Malta,  the  Cape  of  Good  Hope, 
Mauritius,  the  Seychelles,  and  Ceylon.  In  defiance  of  public 
opinion  and  the  common  sentiment  of  Christendom,  British 
foreign  policy  opposed  the  aspirations  of  the  Balkan  states 
for  independence  and  condoned  the  barbarous  massacres 
of  Christians  by  the  Turks,  lest  the  route  across  the  Isthmus 
of  Suez  (safe  enough  whilst  the  important  Ottoman  Empire 
held  Constantinople)  should  be  threatened  by  its  weaken- 
ing, and  lest  Russia  might  then  establish  herself  instead  of 
Turkey  on  the  Golden  Horn,  at  a  time  when  Russian  expan- 
sion south  and  east  through  Asia  was  regarded  as  threaten- 
ing to  India. 

It  was  to  prevent  such  an  occurrence  that  Disraeli  was 
ready  to  start  another  war  with  Russia,  did  in  fact  set  the 
British  fleet  in  motion,  rather  than  permit  the  Treaty  of  San 
Stefano  to  stand,  and  Russia  to  push  nearer  to  the  possession 
of  Constantinople.  Because  the  proposed  construction  of 
the  Suez  Canal  opened  a  new  route  to  India  which  would  be 
in  possession  of  another  Continental  Power,  Great  Britain 
opposed  it;  but  when — protest  having  been  without  avail, 
and  the  canal  having  been  constructed — the  Prime  Minister, 
Disraeli,  was  able  to  buy  hurriedly  from  the  bankrupt  Khe- 
dive of  Egypt  enough  of  the  stock  to  give  the  Empire  an 
opportunity  to  control  the  canal,  English  foreign  policy 
made  an  abrupt  aboutface. 

No  longer  was  the  Ottoman  Empire  useful  as  a  guardian 
of  India,  and  her  quondam  friend  was  the  first  to  attack  the 
integrity  of  the  imperial  territories.  Cyprus  first,  then 
Egypt,  with  only  the  flimsiest  disguises,  were  transferred  to 


The  Economic  Motives  of  Colonial  Rivalry         33 

British  hands,  and  only  then  did  the  Balkan  policy  change, 
and  only  then  were  the  oppressed  Balkan  nations  permitted 
to  seek  what  were,  for  one  in  the  game  of  international 
politics,  "legitimate  aspirations." 

For  the  further  protection  of  India,  Great  Britain  entered 
upon  an  effort  for  the  control  of  the  passages  into  the  Indian 
Ocean,  the  Gulf  of  Bengal  on  the  east,  and  the  Arabian  Sea 
on  the  west,  and  of  the  passages  from  the  Indian  Ocean  into 
these  two  smaller  bodies  of  water.  Soon  it  was  found  neces- 
sary to  secure  control  of  the  shores  of  the  Arabian  Ocean 
and  of  the  Gulf  of  Siam,  and  then  the  policy  began  to  be 
extended  to  the  Hinterland  as  well. 

Surely,  however,  the  enormous  fleet  of  Great  Britain  was 
sufficient  to  protect  the  sea  lanes  leading  to  India,  once  it 
was  assured  that  no  hostile  power  could  possibly  find  footing 
on  the  neighboring  coasts.  No,  for  a  modern  fleet  in  being, 
imposing  as  its  power  may  be,  is  in  another  sense  a  very 
delicate  and  sensitive  mechanism.  The  modern  war  vessel, 
like  any  other  complex  mechanism,  gets  out  of  order  easily. 
Difficulties  with  engines,  electric  lighting,  electric  ammuni- 
tion supply,  electric  fire  control,  injuries  to  hull,  to  wireless, 
to  superstructure,  to  bulkheads, — any  one  of  these  may 
reduce  the  most  powerful  fighting  structure  afloat  to  rela- 
tive impotence.  Because  of  this,  a  great  Power  must  have 
naval  bases  scattered  throughout  the  world,  points  where 
a  warship  may  find  drydocks,  skilled  mechanics,  and  an 
opportunity  to  refit. 

More  than  this,  there  is  the  perpetual  problem  of  fuel 
supply.  The  quantity  of  coal  used  by  a  Dreadnaught  or  a 
battle  cruiser  is  tremendous;  and  even  though  the  modern 
oil-burning  vessels  have  modified  the  fuel  factor  so  as  to 
extend  the  cruising  radius,  they  must  in  the  end  face  the 
same  problems.  It  must  be  remembered  that,  although  in 
time  of  peace  a  warship  may  revictual  and  refuel  in  any 


34  The  Economic  Causes  of  Modern  War 

port,  in  time  of  war  international  law  (which  in  this  point, 
at  least,  is  likely  to  be  observed)  permits  the  supply  by  a 
friendly  Power  of  only  24  hours'  fuel,  or  of  enough  to  permit 
the  vessel  to  reach  its  nearest  home  port. 

Since  fleets  are  planned  and  administered  for  use  in  time 
of  war,  naval  bases  must  be  located  with  reference  to  their 
needs  under  such  conditions,  and  therefore  if  the  British 
fleet  is  to  protect  India,  there  must  be  naval  bases  in  the 
Mediterranean,  in  the  Far  East,  and  conveniently  near  the 
Indian  Ocean.  Not  only  this,  but,  since  the  needs  of  a 
possible  hostile  fleet  would  be  essentially  identical  with  those 
of  the  British  fleet,  against  which  it  would  operate  in  these 
very  waters,  foreign  naval  bases  must  be  excluded  from  this 
territory.  The  obvious  solution  is  to  grab  all  points 
available,  if  not  for  British  use,  then  to  keep  other  powers 
from  gaining  a  foothold. 

So  it  is  that  from  a  fundamentally  economic  motive — the 
protection  of  a  profitable  colony — we  find  the  acquisitions 
of  a  century  accounted  for,  some  won  while  the  evolution 
of  modern  navies  was  barely  beginning  to  make  the  problems 
of  the  naval  policies  of  today  apparent,  others  the  spoil 
of  very  recent  years.  This  is  why  we  find  on  the  routes  to 
India  a  veritable  chain  of  British  possessions:  Gibraltar, 
dominating  the  entrance  to  the  Mediterranean,  Malta, 
Cyprus,  guarding  the  trade  lanes  within  the  sea,  the 
approaches  to  Egypt  and  the  Suez  Canal,  and  through  them, 
the  approaches  to  India  itself.  Egypt  has  long  been  in 
British  hands  for  all  its  nominal  allegiance  to  the  Sultan; 
even  this  cloak  is  now  thrown  off.  Beyond  the  canal  lie 
Aden,  Perim,  and  the  Sudan,  all  in  British  control,  all 
guarding  India,  all  making  for  the  convenience  of  the 
British  power  in  wartime — all  the  logical  outgrowth  of  a 
colonial  policy  which  is  itself  the  outgrowth  of  economic 
need. 


The  Economic  Motives  of  Colonial  Rivalry         35 

In  the  west,  Sokotra,  the  Seychelles  Islands,  and  others, 
and  the  Bahrain  Islands  in  the  Persian  Gulf,  keep  out 
intruders.  At  the  southern  extremity  of  India,  Ceylon 
(itself  an  economic  asset  as  well  as  a  strategic)  serves  for 
defense,  as  do  the  islands  in  the  Bay  of  Bengal;  and  further 
to  the  east,  Singapore,  the  Malay  Peninsula,  and  the  north 
shore  of  Borneo  ward  off  attack  by  way  of  the  Pacific. 

In  order  to  establish  a  strategic  frontier  to  the  north, 
mainly  in  fear  of  Russian  aggression,  Great  Britain  has 
worked  for  years,  with  constant  wars  against  natives  not 
wholly  appreciative  of  the  advantages  of  British  Kultur, 
and  with  equally  constant  friction  with  Russia  and  the 
eternal  possibility  of  a  Russian  war.  During  the  years  be- 
tween 1875  and  1903  Baluchistan  was  gradually  brought 
under  British  rule.  Afghanistan,  extending  north  and  east, 
one  of  the  two  main  keys  to  India,  was  forced  to  accept 
British  dominion  with  nominal  independence,  after  inva- 
sions in  1839,  1842,  1878,  and  1880.  In  1907  the  Anglo- 
Russian  agreement  further  strengthened  the  British  hold 
on  India  by  eliminating  the  possibility  of  imperialistic 
aggression  from  the  north. 

Tibet  is  not  yet  British,  but  it  has  already  been  invaded 
by  expeditionary  forces,  and  would  undoubtedly  have  been 
the  scene  of  further  massacres  (for  that  is  what  the  combats 
between  trained  British  troops  and  the  untrained  and  in- 
effective Tibetan  natives  amounted  to)  had  not  the  agree- 
ment of  1907  put  an  end  to  territorial  rivalry  and  given  at 
least  a  temporary  assurance  that — with  the  prospect  of  Rus- 
sian seizure  put  away — there  could  be  no  threat  to  India 
from  a  province  under  the  suzerainty  of  the  weak  Chinese 
Empire. 

Nepal  and  Bhutan,  except  for  Afghanistan  the  only  re- 
maining "independent"  states  on  the  Indian  border,  are 
secured  to  the  British  by  large  subsidies  and  strictly  enforced 


36  The  Economic  Causes  of  Modem   War 

promises  of  "good  behavior/'  Part  of  the  latter  was  an- 
nexed in  1864  and  in  Bhutan  there  has  been  a  British 
Resident  for  a  century. 

India  furnishes  an  example  01?  a  large  scale  of  the  way 
in  which  the  necessity  for  the  possession  of  colonies  in  turn 
leads  to  the  necessity  for  a  fleet,  which  in  its  turn  leads  to 
the  need  for  naval  bases;  and  it  furnishes  an  example,  too, 
of  the  way  in  which  the  protection  of  trade  routes  demands 
the  control  of  every  important  point  along  them  that  the 
colonial  Power  can  secure.  It  shows  also  the  likelihood  of 
native  wars  for  the  "rectification"  of  a  "scientific"  frontier. 

The  creation  of  a  fleet  by  one  power  for  the  protection  of 
its  colonies  is  an  implied  threat  to  the  safety  of  the  colonies 
of  other  powers  and  to  their  trade,  through  the  eternal 
possibility  of  the  stoppage  of  the  sea  lanes.  If  the  threat- 
ened powers  possess  fleets  or  begin  to  build  them,  we  have 
the  germs  of  naval  rivalry,  in  itself  an  incentive  to  war 
through  mutual  fear,  through  mutual  jealousy,  and  through 
the  chauvinism  of  the  rival  naval  castes. 

All  of  this  springs  from  colonization  and  the  protection  of 
trade  routes,  and  we  have  seen  the  chain  of  economic 
causation  by  which  the  need  for  colonies  and  the  imperative 
necessity  of  foreign  trade  grows  from  overpopulation,  creat- 
ing an  industrial  civilization,  which  brings  about  excessive 
production  and  the  need  for  food,  raw  materials,  and  markets 
beyond  those  that  the  home  state  can  furnish.  In  other 
words,  the  disputes  over  colonies  which  have  lain  at  the 
root  of  the  wars  and  likewise  of  the  international  dissen- 
sions which  have  threatened  wars  for  the  last  half  century, 
have — whatever  their  immediate  and  ostensible  causes — 
had  an  economic  root  in  rivalry  for  markets  and  raw  mate- 
rials. National  rivalry,  naval  rivalry,  military  rivalry,  colo- 
nial rivalry  are  but  different  forms  of  the  fundamental  and 


The  Economic  Motives  of  Colonial  Rivalry         37 

underlying  economic  rivalry  among  modern  nations.  Such 
economic  rivalry  is  the  natural  result  of  growing  populations 
and  of  production  beyond  their  own  needs  among  the  states 
of  Europe,  which  have  become  increasingly  industrial  and 
decreasingly  agricultural  because  of  this  very  growth  of 
population. 

Having  examined  the  general  principles  out  of  which  wars 
have  sprung,  and  having  seen  how  it  is,  in  general,  that 
modern  wars  may  be  produced,  let  us  examine,  one  by  one, 
the  wars  of  the  last  quarter  of  the  Nineteenth  Century  and 
of  the  beginning  of  the  Twentieth  Century.  In  each  we 
shall  discover  an  economic  factor,  whether  immediate  or 
derived.  In  each  we  shall  find  causes  other  than  economic; 
but  in  every  one  (ranging  from  minor  conflicts  with  native 
tribes  in  the  pursuit  of  colonial  policies,  to  hostilities  be- 
tween two  great  Powers,  and  finally  to  the  catastrophe  of 
the  World  War)  we  shall  find  the  economic  factor,  more  or 
less  disguised. 

Let  us  not  be  deceived  by  words.  "Legitimate  aspira- 
tions," "national  ambitions,"  "hegemony,"  "special  inter- 
ests," "spheres  of  influence,"  "national  security" — most  of 
these  are  nothing  save  high-sounding  phrases,  gracefully 
glossing  over  stark  economic  desires,  needs,  greeds,  ambi- 
tions, and  savagely  bitter  rivalries. 


CHAPTER  III 

THE    ECONOMIC     MOTIVES    OF    THE    WARS    OF    THE    WORLD! 

1878-1914 

The  year  1878  is  one  of  the  most  momentous  in  European 
history,  marking  as  it  does  the  beginning  of  the  movements 
which  ended  in  the  formation  of  the  two  great  alliances 
whose  feuds,  jealousies,  and  suspicions  found  their  natural 
culmination  in  the  World  War  of  1914.  It  is  from  the 
Congress  of  Berlin,  held  in  this  year  to  readjust  the  peace 
terms  imposed  upon  Turkey  by  the  victorious  Russians  in 
the  Treaty  of  San  Stefano,  that  the  epoch  of  tremendous 
armaments  under  which  Europe  has  groaned  for  the  last 
half  century  may  properly  be  dated.  Wars  there  have  been 
before  this  date,  and  preparations  for  war,  but  never  on 
such  a  scale  as  have  developed  in  our  own  time  through  the 
national  rivalries  fostered  by  underlying  economic  conflicts. 

The  Congress  of  Berlin  marks  the  close  of  the  period  of 
nationalist  revolutions  and  wars  in  Europe.  With  one  or 
two  exceptions,  all  the  European  states  had  attained  sta- 
bility in  their  constitutional  systems.  From  this  time  on, 
diplomatic  ambition  tended  more  and  more  to  extra-Euro- 
pean interests;  but  the  alliances  that  resulted  from  the 
Treaty  of  Berlin  did  not  make  easier  the  solution  of  the 
vexing  questions  of  international  economics  that  were  to 
come.  Our  planet  had  grown  into  an  economic  whole. 
There  was  no  precedent  in  statecraft  for  such  a  world  sit- 
uation. 

The  root  of  half  the  international  unrest  in  Europe  is  to 
be  found  in  this  treaty,  in  the  hatreds,  dissatisfactions,  and 

38 


The  Wars  of  the  World:  1878-1914  39 

injustices  which  it  created;  and  the  wars  which  have  suc- 
ceeded it,  show  with  greater  clearness  than  ever  before  the 
importance  of  the  economic  factor  in  the  causation  of  war. 

The  Congress  of  Berlin  itself  may  be  said  to  have  arisen 
from  economic  causes,  for  it  was  the  result  of  British  in- 
sistence upon  blocking  the  Russian  movement  towards  Con- 
stantinople— a  policy  which  was  itself  of  economic  origin. 
The  desire  of  Russia  for  the  possession  of  Constantinople 
is  the  natural  demand  of  an  enormous  hinterland  for  an 
outlet  upon  warm  water.  Russia,  primarily  an  agricultural 
land,  has  always  been  denied  access  to  the  sea,  in  spite  of 
her  thousands  of  miles  of  coast.  Archangel,  her  northern 
port,  is  insufficient  because  of  the  ice  which  closes  it  for  half 
the  year.  The  port  of  Vladivostok,  opening  on  the  Pa- 
cific, had  not  then  been  established,  and  even  today  is  in- 
adequate to  satisfy  the  needs  of  the  Empire;  and  the  Baltic 
ports  were  too  few  in  number  to  serve  as  outlets  for  so 
large  a  territory.  Constantinople  is  so  situated  that  it 
can  at  any  time  command  complete  control  over  the  com- 
merce of  southern  Russia,  passing  from  the  Black  Sea  out 
into  the  Mediterranean.  The  Sultan's  interdict  upon  the 
passage  of  war  vessels,  effectually  enclosing  the  Black  Sea 
fleet  and  facilitating  the  British  defense  of  the  Suez  Canal, 
eliminated  Russia  as  a  naval  power  in  the  Mediterranean, 
since  operations  conducted  from  a  Baltic  base  were  wholly 
out  of  the  question.  Russian  eagerness  for  the  possession 
of  this  historic  city  has  been  an  assumption  in  international 
politics  for  a  century  at  least. 

So  much  for  the  economic  motives  on  one  side;  they 
found  themselves  blocked  by  economic  motives  almost  as 
powerful  on  the  other — an  economic  rivalry  which  made 
itself  felt  in  Continental  and  colonial  affairs  constantly  un- 
til the  final  adjustment  of  Anglo-Russian  differences  in 
1907.     British  fear  of  the  results  in  India  of  Russian  ex- 


40  The  Economic  Causes  of  Modern  War 

pansion  had  made  it  a  cardinal  principle  of  foreign  policy 
to  check  Slavic  expansion  in  any  direction,  and  especially 
towards  Constantinople,  which  then  dominated  the  land 
routes  now  followed  by  the  Suez  Canal.  It  is  largely  in 
following  out  this  fundamentally  economic  policy  that 
Great  Britain  had  fought  Russia  in  the  Crimea  in  1854-56 ; 
and  after  the  building  of  the  Canal  and  its  passage  into 
British  hands,  it  was  more  than  ever  important  that  no 
power  should  be  allowed  to  establish  itself  on  the  Bosphorus 
which  might  ever  be  either  capable  or  desirous  of  threat- 
ening the  vital  artery  that  led  straight  to  the  richest  colony 
of  imperial  Britain. 

At  the  outbreak  of  the  war  with  Turkey  in  1877,  the 
Tsar  had  given  his  word  that  he  had  "not  the  smallest  wish 
or  intention  to  be  possessed  of  Constantinople."  The  Turks 
capitulated  early  in  the  following  year,  as  the  Russian  ar- 
mies were  moving  out  of  Adrianople  against  the  last  line 
of  defense  remaining  in  front  of  the  Turkish  capital;  and 
in  the  peace  of  San  Stefano,  Russia,  flushed  with  victory, 
had  imposed  terms  of  peace  which  left  Constantinople  to 
the  Turks  indeed,  but  which  carried  Slavic  territory  to 
their  very  doors,  by  the  erection  of  an  enlarged  Bulgaria 
which  would  include  all  of  eastern  Rumelia,  and  which 
would  extend  Russian  influence  so  near  to  the  all-impor- 
tant city  as  to  be,  in  the  British  view,  dangerous  in  the  ex- 
treme. 

The  Treaty  of  San  Stefano  was  unsatisfactory  to  the 
other  Great  Powers  for  a  variety  of  reasons.  To  Great 
Britain,  the  weakening  of  Turkey  which  would  result  from 
it,  meant  the  possibility  of  Russian  development  which 
might  become  threatening  to  her  colonial  possessions;  and 
this  fear,  economic  in  origin,  was  enhanced  by  the  creation 
of  the  new  Bulgarian  state,  which,  it  was  thought  with 
good  reason,  would  be  a  mere  appanage  of  Russia  and 


The  Wars  of  the  World:  1878-1914  41 

which  would  certainly  be  an  extension  of  Slavic  power.  To 
Austria-Hungary  the  treaty  was  equally  unsatisfactory,  be- 
cause it  increased  Russian  influence  in  the  Balkans  to  such 
an  extent  that  the  Austrian  ambition  for  the  development 
of  her  influence  in  the  regions  in  which  lay  some  of  her 
most  important  markets  might  have  to  be  modified  or 
abandoned. 

Bismarck,  professing  entire  disinterestedness,  but  really 
desirous  of  having  a  finger  in  the  international  pie  for  the 
sake  of  maintaining  the  German  hegemony  which  he  had 
so  dearly  bought,  offered  his  services  as  a  mediator  (or, 
in  his  own  phrase,  as  an  "honest  broker"),  between  the 
conflicting  interests  of  the  Powers.  The  Congress  of  Ber- 
lin met  for  its  first  session  at  two  o'clock  in  the  afternoon 
of  June  13,  1878.  After  a  month  of  stormy  sessions  (dur- 
ing which  the  Russian  plenipotentiary,  Prince  Gortchakoff, 
and  the  English  Prime  Minister,  Lord  Beaconsfield,  both 
threatened  to  break  off  negotiations)  the  Treaty  of  Berlin 
was  finally  patched  together.  England  checked  Russia  at  the 
Bosphorus,  for  Macedonia  was  secured  to  Turkey,  thus 
keeping  the  Slavs  at  a  distance  from  Constantinople  and 
the  route  to  India.  Bulgarian  boundaries  were  so  drawn 
as  still  more  to  halt  the  extension  of  Slavic  power.  Aus- 
tria-Hungary secured  her  "rights"  in  Bosnia-Herzegovina, 
the  privilege  of  administration  and  the  right  of  maintain- 
ing a  military  force  in  the  neighboring  Sanjak  of  Novi- 
Bazar,  which  was  later  to  acquire  a  peculiar  economic  im- 
portance in  connection  with  the  Bagdad  railway. 

The  most  immediate  and  obvious  international  result  of 
the  treaty  was  the  abrupt  ending  of  the  era  of  good  feeling 
which  had  hitherto  existed  between  Russia  and  the  new 
German  Empire,  an  event  which  roused  Bismarck  to  the 
necessity  of  securing  an  Austrian  alliance  against  the  Rus- 
sian attack  which  seemed  imminent.     On  October  7,  1879, 


42  The  Economic  Causes  oj  Modern  War 

this  alliance  was  concluded.     Its  most  important  provi- 
sions were: 

"1.  Should,  contrary  to  the  hope  and  against  the  sincere  wish 
of  the  two  High  Contracting  Parties,  one  of  the  Empires  be  at- 
tacked by  Russia,  the  High  Contracting  Parties  are  bound  to 
stand  by  each  other  with  the  whole  of  the  armed  forces  of  the 
Empires,  and,  in  consequence  thereof,  only  to  conclude  peace 
jointly,  and  in  agreement. 

"2.  Should  one  of  the  High  Contracting  Parties  be  attacked 
by  another  Power,  the  other  High  Contracting  Party  hereby 
binds  itself,  not  only  not  to  stand  by  the  aggressor  of  its  High 
Ally,  but  to  observe  at  least  an  attitude  of  benevolent  neutrality 
towards  its  High  Contractor. 

"3.  If,  however,  in  such  a  case,  the  attacking  Power  should 
be  supported  by  Russia,  either  in  the  form  of  active  co-opera- 
tion or  by  military  measures  menacing  to  the  party  attacked,  the 
obligation  defined  in  Clause  I  of  reciprocal  help  with  the  entire 
armed  strength  comes  immediately  into  force  in  this  case  also, 
and  the  war  will  then  also  be  waged  jointly  by  the  Two  High 
Contracting  Parties  until  the  joint  conclusion  of  peace." 

Germany  was  thus  secured  against  attack  by  Russia,  or 
by  Russia  aided  by  France;  and  assured,  too,  of  the  neu- 
trality of  Austria  in  the  event  of  an  attack  by  either  of 
those  powers  acting  alone. 

To  make  assurance  doubly  sure,  Bismarck  still  desired  a 
third  member  of  the  alliance,  and  he  turned  to  Italy  as  the 
only  available  power.  To  reconcile  the  Italians  to  becom- 
ing the  allies  of  Austria,  their  traditional  foes,  the  astute 
German  Chancellor  had  recourse  to  playing  upon  the  eco- 
nomic desires  of  France  and  Italy  and  stirring  up  the  latent 
colonial  rivalry  between  them.  Realizing  perfectly  that 
both  states  wished  to  expand  in  Tunis,  he  is  said  to  have 
given  France  secretly  to  understand,  in  1882,  that  there 
would  be  no  German  opposition  to  her  occupancy  of  that 
land;  and  then  to  have  taken  advantage  of  the  Italian  in- 


The  Wars  of  the  World:  1878-1914  43 

dignation  at  being  anticipated  in  colonization  by  the 
French,  to  draw  a  third  member  into  the  German-Austrian 
alliance. 

The  existence  of  such  a  Triple  Alliance  was  a  tacit  threat 
to  the  other  Powers  of  Europe.  It  could  be  met  only  by 
the  formation  of  a  rival  alliance,  and  towards  this  inev- 
itable event  history  gradually  shaped  itself.  France  and 
Russia  formed  a  Dual  Entente  in  1891,  almost  ten  years 
afterwards.  England,  by  the  agreement  with  France  in 
1904  and  with  Russia  in  1907,  became  practically  a  part  of 
a  league  which,  not  so  closely  knit  as  was  its  rival,  is  best 
described  in  the  phrase  usually  applied  to  it — the  Entente. 

In  the  Congress  of  Berlin  we  have,  then,  the  origin  of 
the  two  alliances  which  have  divided  Europe  ever  since. 
The  history  of  the  wars  of  Europe,  from  this  time  on,  is 
the  history  of  the  colonial  ambitions,  commercial  enter- 
prises, economic  difficulties,  of  one  or  the  other  of  them. 
Although  never  until  1914  did  the  two  great  groups  of 
powers  come  to  grips,  yet  every  one  of  the  component  states 
has  been  involved  again  and  again  in  wars  in  which  the 
economic  motive  was  predominant;  and  in  each  case  the 
issue  has  been  affected  by  the  existence  of  the  alliances 
and  the  ever-present  possibility  of  the  two  groups'  be- 
coming involved  as  wholes.  During  this  period  the  in- 
dustrial changes  of  the  century  became  complete.  From 
1878  we  have  a  new  relationship  in  the  affairs  of  Europe, 
and  from  this  year  we  may  begin  our  survey  of  the  eco- 
nomic rivalries  which  have  produced  its  wars. 

Two  more  events  mark  the  year  1878  as  significant  in 
the  history  of  Europe.  One  was  the  return  from  Africa 
of  Henry  M.  Stanley,  sent  thither  by  the  New  York  Herald 
to  find  the  missionary,  David  Livingstone.  Though  it  lies 
at  the  very  doors  of  Europe,  though  its  northern  coast  had 


44  The  Economic  Causes  of  Modern  War 

supported  a  flourishing  civilization  when  all  Europe  was  a 
wilderness,  and  though  eight  generations  of  European  mari- 
ners had  circumnavigated  the  continent  on  their  way  to 
India,  Africa  was  an  almost  unknown  land.  That  it  had 
been  permitted  to  remain  so  while  distant  America  was 
growing  into  a  great  state,  is  due  to  the  peculiarly  in- 
hospitable character  of  the  coasts.  The  vast  and  fertile  in- 
terior plateau  is  nearly  everywhere  shut  away  from  the  sea, 
either  by  parched  deserts  or  malarial  swamps,  while  the 
great  rivers,  with  courses  interrupted  either  by  falls  or 
rapids,  hold  out  little  inducement  to  the  navigator.  Ex- 
cept for  English  and  Dutch  settlements  at  the  extreme 
south,  the  French  in  the  extreme  north,  a  few  trading 
centres  on  the  West  Coast,  and  some  all  but  derelict  Portu- 
guese stations  in  Angola  and  Mozambique,  the  whole  con- 
tinent lay  available  for  exploitation  by  European  powers 
upon  whom  economic  pressure  was  just  beginning  to  be 
galling.  Only  in  the  light  of  the  last  fifty  years  can  the 
true  significance  of  Stanley's  return  be  appreciated.  It 
meant  the  opening  up  of  a  Continent,  old  but  new,  and  of 
a  host  of  economic  rivalries  which  were  to  imperil  the  peace 
of  the  whole  globe. 

The  other  event  was  the  announcement  of  the  invention 
by  the  English  metallurgist,  Sidney  Gilchrist  Thomas,  of 
a  new  method  of  manufacturing  steel  of  the  first  quality 
from  phosphorus-bearing  ore.  Continental  ironmasters, 
especially  the  Germans,  had  profited  little  from  Sir  Henry 
Bessemer's  earlier  discovery  of  a  method  of  converting  pig 
iron  into  steel,  for  Bessemer  had  based  his  process  on  ex- 
periments upon  English  ores  without  phosphorus,  and  it 
was  inapplicable  to  the  rich  ore  deposits  of  Lorraine,  which 
contained  much  of  this  element.  Although  the  English 
manufacturers  failed  to  appreciate  the  enormous  signifi- 
cance of  Thomas's  new  process,  their  German  rivals  were 


The  Wars  of  the  World:  1878-1914  45 

more  alive  to  its  value;  and  with  it  as  a  foundation  they 
began  the  vast  development  of  the  German  iron  industry 
which  won  world  supremacy  in  the  most  important  com- 
modity of  the  Age  of  Steel.  It  was  by  the  adoption  of  an 
Englishman's  invention  and  the  seizure  of  the  French  iron 
fields  that  they  were  able  to  win  it.  Thomas,  through  his 
discovery,  was  unwittingly  helping  to  initiate  the  struggle 
for  iron  fields  which  was  one  of  the  most  important  phases 
of  the  forty  years  of  bitter  economic  rivalry  that  followed, 
culminating  in  a  world  war. 

More  convincing  than  a  priori  discussion  of  the  economic 
causes  which  produce  war,  is  examination  of  the  history 
of  the  period  since  1878  and  a  study  of  the  genesis  of  the 
wars  that  have  occurred  during  that  time.  How  does  the 
theory  of  the  economic  chain  of  causation  which  makes  war 
inevitable  bear  application  to  the  events  of  history?  The 
question  is  to  be  answered  only  after  scrutiny  of  the  fun- 
damental causes  of  the  wars  that  have  actually  been  fought. 
According  to  the  theory  outlined  in  the  last  two  chapters, 
the  great  wars  of  the  period  should  be  traceable — not  di- 
rectly, perhaps,  but  always  ultimately — to  economic  causes. 
Rivalry  for  colonies,  the  desire  for  trade  routes,  the  at- 
tempt to  secure  the  naval  bases  essential  to  both  of  them, 
naval  rivalry  born  of  colonial  policy,  the  desire  for  mar- 
kets, food,  or  raw  materials — these  should  be  found,  if  the 
chain  of  causation  is  valid,  at  the  root  of  the  wars  that  have 
been  fought  since  the  world  became  an  economic  unit — 
roughly,  since  the  Treaty  of  Berlin. 

An  exhaustive  list  of  the  military  operations  since  1878 
shows  that  during  forty  years  there  have  been  only  four  in 
which  the  world  was  everywhere  at  peace:  1886,  1888,  1889, 
and  1910. 


46  The  Economic  Causes  of  Modern  War 

Wars  of  the  World:  1878-1918  l 

1878-1882— Afghan  Wars  (Great  Britain  and  Afghanistan). 
1879-1883— Nitrate  War  (Chile  against  Peru  and  Bolivia) . 
1879         — Zulu  War  (British  campaign  against  the  Zulus). 
1880-1881— First  Boer  War  (Great  Britain  and  Boer  settlers). 
1881  — Russian  operations  in  Turkestan. 

1882-1885 — French  colonial  wars  in  Annam. 
1882-1898— British  occupation  of  Egypt. 

1883  — Military  revolt  in  Spain. 

1884  — Russian  operations  in  Afghanistan. 

1885  — Serbo-Bulgarian  War. 
1885         — Bulgarian  Revolution. 

1887         — First  Abyssinian  War    (Italian  invasion  of  Abys- 
sinia). 

1890  — War  between  Guatemala  and  San  Salvador. 

1891  — Military  revolt  in  Portugal. 

1891  — Chilean  Revolution. 

1892  — Revolts  in  Argentina. 

1892  — French  operations  in  Dahomey. 

1892  — Revolt  in  Venezuela. 

1893  — Hawaiian  Revolution. 
1893  —Revolt  in  Sicily. 

1893  — Spanish  operations  against  Moors. 

1893         — Brazilian  Revolution. 

1893  — Argentine  Revolution. 

1894  — Hottentot  Revolt  in  German  Southwest  Africa. 
1894-1895— Chino- Japanese  War. 

1896         — Insurrection  in  Crete. 

1896         — Anti-Armenian  riots  in  Constantinople. 

1895-1896 — Ashantee    War    (Great    Britain    against    Ashantee 

tribesmen) . 
1896         — British  bombardment  of  Zanzibar. 
1896         — Revolt  in  Philippines. 

1896  — Second    Abyssinian    War    (Italians    against    Abys- 

sinians) . 

1897  —Greco-Turkish  War. 

lrThis  list  is  from   data  compiled  in  the  library  of  the   General  Staff 
College,  United  States  Army. 


The  Wars  of  the  World:  1878-1914  47 

1895-1898 — Cuban  Insurrection. 

1898         — Spanish-American  War. 

1899-1900 — Philippine  Insurrection. 

1899-1902 — Second  Boer  War  (Great  Britain  against  Transvaal 

and  Orange  Free  State). 
1900-1901 — Boxer  Uprising  and  Allied  Relief  of  Peking. 

1901  — Colombian  Revolution. 

1902  — British  operations  in  Somaliland. 

1903  — British  operations  in  Tibet. 

1903-1908 — Herero  Rising   (German  operations  against  natives 

of  German  Southwest  Africa). 
1904-1905 — Russo-Japanese  War. 
1908-1909— Civil  War  in  Morocco. 
1908         — Italian  operations  in  Somaliland. 

1908  — Haitian  Revolution. 

1909  — Rebellion  in  Santo  Domingo. 
1909         — Civil  War  in  Nicaragua. 

1911  — Italo-Turkish  War. 

1912  — Mutiny  of  native  troops  in  French  Morocco. 
1912         — Mexican  Revolution. 

1912-1913— First  and  Second  Balkan  Wars. 
1914-1918— World  War. 

For  convenience,  this  list  may  be  reduced  by  the  elimi- 
nation of  racial  riots,  revolutions  in  South  American  states, 
and  minor  wars  with  savage  tribes.  Study  of  the  causes 
of  such  minor  military  operations  as  are  involved  in  these 
trifling  conflicts  and  in  the  revolutions  of  unsettled  states, 
sheds  little  light  on  the  main  problems  of  the  causes  of 
international  war.  Operations  against  savages  which  are 
directly  due  to  the  invasions  of  white  settlers,  are  obvi- 
ously the  outcome  of  the  economic  conditions  sketched  in 
the  last  chapter,  which  make  necessary  the  colonization 
that  is  necessarily  resisted  by  the  natives  of  the  colonized 
lands.  A  few  such  campaigns,  selected  so  as  to  be  typical 
of  all,  are  sufficient  to  illustrate  the  strictly  economic  char- 
acter of  these  struggles.    Yet  the  list  of  the  wars  of  the  last 


48  The  Economic  Causes  of  Modern  War 

forty  years,  thus  reduced,  must  be  sufficiently  extended  to 
include  all  the  major  international  conflicts  of  the  period 
and  the  more  important  wars  of  colonization.  With  these 
eliminations,  twenty  wars  remain  to  be  considered: 

The  Principal  Wars:  1878-1918 

1878-1882— Afghan  Wars. 
1879         —Zulu  War. 
1879-1883— Nitrate  War. 
1880-1881— First  Boer  War. 
1882-1898— British  Occupation  of  Egypt. 
1882-1885— French  Colonial  Wars  in  Annam. 
1885         — Serbo-Bulgarian. 
1887         — First  Abyssinian  War. 
1894-1895— Chino-Japanese  War. 
1895-1898— Cuban  Insurrection. 

1896  — Second  Abyssinian  War. 

1897  —Greco-Turkish  War. 

1898  — Spanish-American  War. 
1899-1902— Second  Boer  War. 
1900-1901— Boxer  Uprising. 
1903-1908— Herero  Rising. 
1904-1905 — Russo-Japanese  War. 
1911-1912— Italo-Turkish  War. 
1912-1913— Balkan  Wars. 
1914-1918— World  War. 

One  fact  leaps  to  light  immediately:  namely,  that  five 
of  these  conflicts,  omitting  the  World  War  of  1914-1918, 
have  occurred — whether  rightly  or  wrongly — as  a  result 
of  the  spread  of  the  British  imperial  dominion,  made  nec- 
essary by  economic  pressure.  These  are  the  Afghan  WTars 
of  1878-1882,  which,  as  we  have  already  seen,  had  to  do 
with  safeguarding  the  rich  British  possessions  in  India;  the 
Zulu  War  of  the  same  year,  which  was  made  necessary  by 
the  spread  of  British  rule  in  South  Africa;  the  Egyptian 


The  Wars  of  the  World:  1878-1914  49 

War  of  1882,  which,  with  the  subsequent  fighting  in  the 
Sudan,  was  a  natural  consequence  of  the  British  interfer- 
ence in  Egypt,  a  measure  in  itself  intimately  connected  with 
the  protection  of  the  Suez  Canal  and  the  trade  route  to 
India;  and  the  two  Boer  Wars  in  South  Africa,  one  lasting 
from  1880  to  1881,  and  the  second  from  1899  to  1902,  and 
taxing  the  resources  of  the  entire  Empire,  both  results  of 
the  friction  growing  out  of  the  British  colonial  policy. 

Seven  more  of  the  wars  upon  the  list  have  their  origin  di- 
rectly in  colonies  or  colonial  administration :  the  two  Abys- 
sinian Wars,  the  Cuban  Insurrection  of  1895-1898,  leading 
directly  to  the  Spanish-American  War,  the  little  colonial 
war  of  the  French  in  Annam,  the  Herero  Rising  in  Ger- 
man Southwest  Africa,  and  the  Italian-Turkish  fighting 
over  Tripoli  in  1911. 

Both  the  Chino-Japanese  and  the  Russo-Japanese  Wars 
were  the  direct  outcome  of  imperial  expansion  and  of  eco- 
nomic rivalry,  for  the  first  resulted  from  the  rivalry  of  the 
two  nations  in  Korea,  and  from  Chinese  supineness  before 
Occidental  greed,  which  aroused  Japan's  fears  for  herself; 
and  the  second  from  economic  difficulties  in  Korea  and 
China. 

Fourteen  of  these  twenty  wars  can  be  seen  at  first 
glance  to  have  been  at  least  partly  economic  in  their  origin, 
for  they  have  resulted  from  colonial  expansion,  which  we 
have  seen  is  due  to  economic  needs;  and  since  the  war  be- 
tween the  United  States  and  Spain  was  a  result  of  the 
economically  caused  Cuban  Insurrection,  it,  too,  may  be 
set  down  at  once  as  having  economic  conditions  at  its  root, 
without  consideration  of  the  economic  interests  of  the 
United  States  in  Cuba,  which  were  officially  avowed  as  one 
of  the  reasons  for  entering  upon  hostilities.  To  these,  two 
more  must  be  added :  the  Nitrate  War  between  Chile,  Peru, 
and  Bolivia,  which  was  avowedly  a  quarrel  over  territories 


50  The  Economic  Causes  of  Modern  War 

in  which  valuable  minerals  existed,  and  the  war  of  1914- 
1918,  the  greatest  and  most  terrible  of  all,  presenting  the 
most  complex  network  of  colonial  rivalries,  economic  strug- 
gles, tariff  discriminations,  naval  rivalries,  efforts  to  secure 
raw  materials,  and  other  causes  which  have  their  roots  in 
economics.  Apparently,  then,  on  cursory  examination, 
sixteen  of  the  twenty  wars  since  the  Congress  of  Berlin 
have  had  self-evident  economic  causes. 

In  scrutinizing  the  origins  of  these  wars,  one  by  one, 
three  groups  of  facts  are  to  be  determined:  first,  the  sev- 
eral causes  which  contributed  to  each  war;  second,  the 
existence  of  an  economic  motive  for  risking  hostilities;  and 
third,  the  importance  of  this  economic  motive  in  relation  to 
the  other  causes.  Frequently  the  underlying  cause  of  hos- 
tilities does  not  appear  directly,  and  a  war  appears  to  be 
solely  the  result  of  non-economic  factors,  until  the  imme- 
diate causes,  upon  further  examination,  are  seen  to  be  the 
outcome  of  trade  rivalry  or  the  desire  to  protect  economi- 
cally important  colonies,  and  hence,  in  their  essence,  eco- 
nomic. The  first,  taken  in  chronological  sequence,  is  the 
Afghan  War  of  1878-1882. 

THE   AFGHAN   WAR,   1878-1882 

The  two  British  wars  in  Afghanistan,  the  first  in  1838- 
1842,  and  the  second  in  1878-1882,  rose  directly  out  of  the, 
rivalry  of  Great  Britain  and  Russia  in  their  colonial  expan- 
sion. The  Russian  Empire  had  spread  itself  gradually 
across  Siberia  and  southward  at  the  same  time  that  the 
British  Empire  was  spreading  through  India  and  north- 
ward, so  that  collision  came,  as  was  inevitable,  in  Persia 
and  Afghanistan,  which  lay  as  buffer  states  between  the 
two  expanding  Powers.  The  comparison  made  by  Lord 
Lytton  just  after  his  appointment  as  Viceroy  of  India,  in 


The  Wars  of  the  World:  1878-1914  51 

a  speech  to  an  Afghan  envoy,  is  very  applicable,  although 
scarcely  calculated  to  soothe  the  feelings  of  the  Amir  of 
Afghanistan.  The  little  native  state,  said  the  representa- 
tive of  the  British  Crown,  was  in  the  predicament  of  "an 
earthen  pipkin  between  two  iron  pots." 

The  Afghan  wars  were  wars  of  defense — defense  of  the 
rich  British  dominions  in  India  against  possible  Russian 
aggression  through  Afghanistan,  with  no  consideration 
whatever  for  the  rights  and  preferences  of  the  Afghan  na- 
tion as  to  the  role  it  was  to  play.  They  were  the  result 
of  the  colonial  and  economic  rivalry  then  existing  between 
two  great  and  constantly  expanding  empires.  They  were 
fought  to  secure  the  safety  of  a  rich  colony  which  was 
necessary  to  the  economic  needs  of  Great  Britain. 

Afghanistan  lies  in  the  hill  country  to  the  north,  and 
through  it,  three  passes  open  into  India,  of  which  the  most 
important  is  the  famous  Khyber  Pass.  So  long  as  Russia 
remained  the  enemy  of  Great  Britain,  the  mere  possibility 
of  her  establishing  herself  in  Afghanistan  was  a  direct 
threat  to  the  safety  of  the  Indian  Empire;  but  although 
Russian  intrigues  looking  to  this  result  had  long  been  in 
progress,  they  had  met  with  no  success. 

The  Afghans  are  a  proud  and  savage  race  of  mountain- 
eers, fanatic  in  their  adherence  to  the  Moslem  faith,  bit- 
terly opposed  to  the  presence  of  foreign  influence  in  their 
country,  good  fighters;  and  the  Amir,  aside  from  the  ir- 
regulars furnished  by  the  hill  tribes,  had  at  his  command, 
in  1879,  an  army  of  about  120,000  men.  In  1838-1842  the 
British  had  attempted  armed  intervention  in  the  internal 
affairs  of  Afghanistan,  with  a  view  to  setting  up  in  Kabul, 
the  capital,  a  government  which  would  be  favorable  to 
them.  The  attempt  ended  in  almost  complete  failure  and 
disaster. 


52  The  Economic  Causes  of  Modern  War 

The  international  situation  in  1878,  after  the  Russian 
successes  against  the  Turks  and  the  Treaty  of  San  Stefano, 
had  further  alarmed  the  British  and  had  brought  the 
Afghan  question  to  a  crisis.  It  was  evident  that  a 
Russian  onslaught  upon  India  would  come  through 
Afghanistan  if  it  ever  came;  but  as  to  the  best  method 
of  meeting  it,  there  were  two  opinions.  Military  leaders 
and  high  officials  of  the  Indian  Civil  Service  had  long  held 
that  the  protection  of  the  British  frontier  was  best  left  in 
the  hands  of  the  Afghans  themselves,  who  would  certainly 
resent  the  presence  in  their  country  of  a  Russian  invading 
force.  The  Russians  would  thus  have  to  make  their  way 
through  a  mountainous  country  without  railways,  exposed 
not  only  to  the  attack  of  the  regular  Afghan  army,  but  also 
to  the  forays  of  hill  tribes,  which,  even  when  hostile  to  the 
Amir's  forces,  would  join  with  them  against  a  foreigner. 
After  their  own  experience  in  1838-1842,  the  British  of- 
ficers were  not  disposed  to  underestimate  the  fighting  quali- 
ties of  the  Afghan.  The  Russian  invading  army,  then, 
could  meet  the  British  only  after  a  long  and  difficult  march, 
and  after  waging  with  Afghanistan  a  war  which  might  in- 
duce the  Afghans  to  accept  British  assistance.  It  was  felt 
by  the  exponents  of  this  view  that  the  effort  to  obtain  a 
"strategic"  or  "scientific"  frontier  at  the  expense  of  Afghan- 
istan would  be  more  than  offset  in  its  advantages  by  the 
hostility  thus  incurred  among  the  natives,  by  the  uncer- 
tainty of  communications,  and  by  the  increase  of  the  dis- 
tances between  the  British  advanced  posts  and  their  bases 
in  India  proper. 

In  the  words  of  the  distinguished  British  war  correspond- 
ent, Archibald  Forbes,  who  accompanied  the  troops  in  both 
campaigns:  1 

1  Archibald  Forbes:   The  Afghan  Wars,  p.  162. 


The  Wars  of  the  World:  1878-1914  53 

"The  relations  between  Shere  Ali  (Amir  of  Afghanistan)  and 
the  successive  Viceroys  of  India  were  friendly,  although  not 
close.  The  consistent  aim  of  the  British  policy  was  to  main- 
tain Afghanistan  in  the  position  of  a  strong,  friendly,  and  inde- 
pendent state,  prepared  in  certain  contingencies  to  co-operate  in 
keeping  at  a  distance  foreign  intrigue  or  aggression;  and  while 
this  object  was  promoted  by  donations  of  money  and  arms,  to 
abstain  from  interference  in  the  internal  affairs  of  the  country, 
while  according  a  friendly  recognition  to  the  successive  occu- 
pants of  its  throne,  without  undertaking  indefinite  liabilities  in 
their  interest.  The  aim,  in  a  word,  was  to  utilize  Afghanistan  as 
a  'buffer'  state  between  the  northwestern  frontier  of  British  India 
and  Russian  advances  from  the  direction  of  Central  Asia." 

About  1867,  however,  there  began  to  creep  in  among 
army  officers  the  notion  that  advanced  posts  in  Afghanis- 
tan would  be  an  advantage  in  meeting  Russian  attack. 
In  general  it  met  with  little  approval  among  professional 
soldiers  in  the  Indian  Army;  but  the  scheme  did  find  favor 
in  London  with  the  members  of  the  Cabinet,  the  Conserva- 
tive party  being  then  in  power,  and  became  the  subject  of 
a  good  deal  of  Parliamentary  discussion.  In  1876  the  pol- 
icy of  a  "scientific  frontier" — which  meant  interference  in 
Afghanistan — was  introduced  by  the  Beaconsfield-Salisbury 
Cabinet,  and  Lord  Lytton  went  out  to  India  with  instruc- 
tions to  abandon  the  former  policy  of  "masterly  inactiv- 
ity" as  regarded  the  border. 

The  occupation  by  the  British  of  Quetta,  on  the  frontier, 
and  military  preparations  there,  were  quite  naturally  re- 
garded by  the  Afghans  as  the  prelude  to  an  invasion.  While 
negotiations  with  the  Amir  were  in  progress,  his  envoy  died 
and  the  British  envoy,  Sir  Louis  Pelly,  was  recalled  by 
Lytton  on  the  ground  that  the  Amir  was  intriguing  with 
the  Russian  General  Kaufmann,  at  Tashkand,  on  the  Rus- 
sian border  of  Afghanistan.  Lord  Salisbury  authorized  the 
Viceroy  to  protect  the  border  as  seemed  best  to  him,  "with- 


54  The  Economic  Causes  of  Modern  War 

out  regard  to  the  wishes  of  the  Amir  or  the  interests  of 
his  dynasty."  After  the  Congress  of  Berlin  the  Russians 
were  forced  to  give  up  the  concentration  of  troops  which 
had  been  begun  on  the  Afghan  border;  but  they  profited 
by  the  estrangement  from  the  British  Government  pro- 
duced by  Lord  Lytton's  truculent  policy,  to  send  an  em- 
bassy to  Kabul,  which  was  received  by  the  Amir  with  open 
arms. 

The  British  demand  that  a  mission  from  India  should 
also  be  received  at  Kabul  was  refused  and  the  envoys  were 
turned  back  at  the  frontier.  The  Indian  Government  sent 
an  ultimatum  which,  unless  a  favorable  reply  was  returned 
by  November  20,  1879,  was  to  be  followed  by  immediate 
hostilities.  The  Amir  sent  no  reply,  and  three  British  ar- 
mies moved  to  the  attack.  Warfare  continued  until  May 
30,  when  the  Treaty  of  Gundamuk  was  signed,  by  the  terms 
of  which  the  British  Government  in  India  secured  the  stra- 
tegic frontier  on  the  most  exposed  border  of  the  most  im- 
portant of  the  British  possessions,  for  which  it  had  been 
intriguing.  Afghanistan,  losing  its  character  of  an  inde- 
pendent buffer  state,  became  to  all  practical  intents  a  de- 
pendency of  the  British  Crown.  The  control  of  foreign 
affairs  was  vested  in  the  British  Government  and  the  Amir 
consented  to  accept  a  British  Residency  and  to  guarantee 
its  safety,  the  British  in  their  turn  pledging  themselves  not 
to  interfere  in  the  internal  affairs  of  the  native  state.  Three 
districts,  together  with  the  strategically  all-important 
Khyber  and  Michnai  Passes  were  ceded  to  Great  Britain. 
Commercial  relations  between  Afghanistan  and  India  were 
to  be  encouraged  and  the  Amir  accepted  an  annual  subsidy 
of  60,000  pounds. 

The  treaty  endured  for  a  little  more  than  three  months 
before  the  Afghan  hatred  of  the  foreigner  blazed  out  and 
the  entire   British   mission   was  massacred.    The   second 


.The  Wars  oj  the  World:  1878-1914  55 

Afghan  campaign,  which  ended  with  the  British  victory  at 
Candahar,  September  1,  1882,  completely  crushed  the  na- 
tive state,  which  was  saved  by  the  accession  to  power  in 
England  of  the  Liberal  Party,  pledged  to  reverse  in  most 
respects  the  foreign  policy  of  their  Conservative  prede- 
cessors, of  which  the  Afghan  aggression  was  an  integral 
part.  Lord  Lytton  resigned  as  Governor-General  of  India. 
The  Conservative  Premier's  scheme  for  an  advanced  fron- 
tier in  Afghanistan,  which  had  always  had  high  military 
opinion  against  it,  was  abandoned  at  the  very  moment 
when  the  territory  was  in  the  hands  of  the  British  army. 
The  Empire  retained  only  the  Pisheen  and  Subu  Valleys, 
abandoning  both  the  Khyber  Pass  and  the  Kuram  Valley, 
after  two  costly  campaigns,  the  expenditure  of  twenty 
million  pounds  sterling,  and  the  loss  of  many  lives,  return- 
ing practically  to  the  status  quo  ante  and  very  nearly  to 
the  old  policy  of  "masterly  inactivity." 

In  1884-1885  the  old  question  of  the  safety  of  India  and 
the  economic  rivalry  of  the  expanding  imperial  powers  came 
very  near  to  causing  another  war.  Russia  seized  Penjdeh 
from  the  Afghans,  and  only  the  threatening  condition  of 
internal  affairs  in  Ireland  and  South  Africa  prevented  a 
British  declaration  of  war. 

Should  the  Afghan  War  be  regarded  as  an  economic  war? 
Directly,  no.  Indirectly,  yes.  It  grew  out  of  a  frontier 
dispute,  but  it  was  fundamentally  the  result  of  the  same 
need  for  economic  expansion  which  originally  led  to  the 
acquisition  of  India  and  which  made  its  wealth  essential  to 
the  British  Empire.  Had  there  been  no  policy  of  imperial 
expansion  on  the  part  of  either  Russia  or  Great  Britain, 
which  was,  of  course,  the  outcome  of  economic  causes  and 
in  the  deepest  sense  a  true  economic  rivalry,  there  would 
have  been  no  Afghan  Wars. 

The  wars  in  Afghanistan  are  results  of  the  friction  due 


56  The  Economic  Causes  of  Modern  War 

to  economic  causes  between  Great  Britain  and  Russia, 
which  existed  in  the  latter  part  of  the  Nineteenth  and  the 
first  years  of  the  Twentieth  Century.  This  rivalry  ex- 
pressed itself  in  difficulties  over  Constantinople,  intrigues 
in  native  states,  and  colonial  expansion;  but  in  every  case 
the  difficulties  were  the  outcome  of  economic  requirements 
— primarily  a  Russian  effort  to  secure  ports  in  warm  water 
and  to  establish  Slavic  power  over  the  waterway  at  Con- 
stantinople, blocked  by  English  determination  to  protect  at 
all  costs  the  trade  route  to  India  and  the  land  frontier  of 
the  richest  of  all  colonies.  Raw  materials,  notably  the 
Baku  oil  wells,  also  came  to  be  involved  before  the  Anglo- 
Russian  Agreement  of  1907  finally  removed  the  roots  of  the 
difficulty. 

THE   ZULU   WAK,   1879 

The  Zulu  War  of  1879,  which  resulted  in  the  pacifica- 
tion by  force  of  the  natives  and  the  ultimate  incorporation 
of  Zululand  with  the  colony  of  Natal,  has  been  variously 
represented  as  a  necessary  measure  of  defense  and  as  the 
violent  extension  of  the  imperial  domains.  In  either  event, 
it  falls  at  once  into  the  class  of  wars  which  have  an  eco- 
nomic motive  in  that  they  are  the  inevitable  concomitants 
of  colonial  expansion;  for  wherever  the  white  man,  forced 
by  economic  need,  spreads  his  rule  into  the  more  sparsely 
settled  portions  of  the  earth,  he  meets  inevitably  the  re- 
sistance of  the  native  population.  Even  though  the  war  be 
regarded  as  necessary  to  the  defense  of  Natal,  it  is  still  an 
outcome,  though  less  direct,  of  the  economic  forces  which 
originally  occasioned  the  colony's  establishment.  Elimi- 
nate the  economic  need  and  you  eliminate  at  a  stroke  both 
the  colony  and  the  problem  of  its  defense. 

On  the  borders  of  the  British  colony  of  Natal  lay  the 


The  Wars  of  the  World:  1878-1914  57 

native  state  of  the  Zulus,  ruled  by  its  native  king  accord- 
ing to  tribal  customs.  In  1873,  after  the  close  of  a  civil 
war  among  the  Zulus,  the  king  Cetewayo  was  induced,  prob- 
ably with  an  eye  to  the  material  advantages  of  British 
friendship,  to  go  through  the  form  of  accepting  a  tinsel 
crown  from  an  English  official.  Between  1873  and  1879 
the  Zulus  were  arming  and  organizing  a  drilled  and  disci- 
plined army.  There  was  no  conceivable  enemy  for  the 
natives  to  fight  except  the  British  and  therefore,  after  they 
had  refused  to  yield  to  the  British  demand  for  disarmament, 
imperial  troops  were  directed  against  them.  The  capture 
of  the  British  camp  at  Isandhlwana  and  the  desperate 
defense  of  Rooke's  Drift  were  followed  by  a  series  of 
victories  for  the  army  commanded  by  Lord  Chelmsford. 

The  Zulus  were  quickly  crushed,  Cetewayo  captured,  and 
sent  to  St.  Helena.  He  was  allowed  to  return  to  his  people 
four  years  afterward;  and  following  a  period  of  hesitation 
by  the  colonial  administration,  Zululand  became  a  part  of 
Natal  in  1897. 

The  war  is  typical  of  the  type  of  hostilities  that  break 
out  almost  inevitably  as  the  result  of  the  spread  of  the 
white  man,  for  economic  reasons,  into  the  territory  of  white 
or  half  savage  races.  Economic  pressure  in  the  colonizing 
country  and  the  pressure  of  other  European  nations  lead 
to  an  attempt  to  expand,  which  brings  in  its  train  the  need 
for  crushing  by  force  the  native  races,  unwilling  to  be  dis- 
possessed. Even  these  little  wars,  then,  are  properly  to 
be  classed  among  those  caused  by  economic  pressure. 

THE    NITRATE    WAR,    1879-1883 

The  desire  of  Chile  to  secure  a  share  in  the  nitrate  trade, 
of  Bolivia  to  hold  nitrate  deposits  in  the  Desert  of  Ata- 
cama,  and  of  Peru  to  maintain  her  supremacy  in  the  guano 


58  The  Economic  Causes  of  Modern  War 

trade,  explain  the  motivation  of  the  Nitrate  War,  or  War 
of  the  Pacific,  which  began  with  Chile's  declaration  of  war 
on  the  other  two  republics,  April  5,  1879,  and  ended  with 
Chilean  victory,  in  the  Treaty  of  Ancon,  October  20,  1883. 
The  far-reaching  and  long-enduring  character  of  the  eco- 
nomic difficulty  and  the  way  in  which  it  tends  to  re-appear 
with  each  successive  unsettlement  of  international  relations 
is  shown  by  the  re-opening  of  this  question  in  1918  during 
the  World  War. 

The  use  of  guano  as  a  fertilizer  in  agriculture  had  been 
known  to  the  prehistoric  inhabitants  of  Peru,  whose  Inca 
rulers  carefully  regulated  its  collection  and  use.  Specimens 
were  first  brought  to  Europe  by  Alexander  von  Humboldt 
in  1804.  In  the  middle  of  the  last  century,  it  came  into 
general  use  as  a  fertilizing  material  of  peculiar  value,  being 
rich  in  nitrogenous  and  phosphate  compounds,  mainly  de- 
rived from  the  long  accumulation  of  the  droppings  of  sea- 
fowl  on  South  American  coasts  and  islands  where  the  cli- 
mate is  dry  and  the  rainfall  slight.  Until  1874  most  of 
the  Peruvian  guano  was  obtained  from  the  Chincha  Islands, 
about  twelve  miles  off  the  coast  of  Peru.  Each  of  the  is- 
lands, from  five  to  six  miles  in  circumference,  was  covered 
with  guano  deposits,  to  a  depth  of  200  feet,  in  successive 
strata  ranging  in  thickness  from  three  inches  to  a  hundred 
feet. 

Guano  thus  formed  the  staple  article  of  Peruvian  export, 
and  the  largest  single  source  of  revenue,  the  exports  rang- 
ing from  $9,000,000  to  $15,000,000  yearly  in  the  years  im- 
mediately before  and  after  1870.1  But  two  causes  operated 
to  reduce  this  highly  profitable  industry,  on  which  the 
wealth  of  Peru  largely  hinged — the  exhaustion  of  the  de- 
posits, partly  due  to  failure  properly  to  protect  the  guano 

1  Statesman's  Yearbook,  1874,  pp.  552-553. 


The  Wars  of  the  World:  1878-1914  59 

birds,  and  the  discovery  of  other  and  cheaper  sources  of 
commercial  fertilizers  in  the  phosphate  beds  of  the  United 
States,  the  potash  deposits  of  Germany,  and  the  nitrate  beds 
now  owned  by  Chile.  It  was  these  deposits,  now  Chilean, 
which  led  to  the  Nitrate  War. 

Nitrate  of  soda,  known  commercially  as  "nitrate"  or 
"Chile  saltpetre,"  comes  from  the  rainless  districts  of  Chile 
and  Peru,  and  the  largest  deposits  are  found  in  the  prov- 
inces which  were  the  prizes  of  the  war,  Tacna,  Arica,  and 
Tarapaca.  They  are  believed  to  be  due  either  to  the  evap- 
oration of  an  ancient  sea,  or  to  be  the  saline  residue  of 
the  evaporation  of  fresh  water  streams.  Although  exports 
from  the  few  which  were  known  had  been  made  as  early 
as  1830,  the  wide  extent  and  enormous  value  of  the  de- 
posits were  not  realized  until  the  latter  half  of  the  century. 

The  beginning  of  difficulties  that  led  to  war  was  a  dis- 
pute relative  to  the  frontier  between  Chile  and  Bolivia, 
which  at  that  time  held  a  small  strip  of  seacoast  near 
Cobija,  between  22°  and  23°  south  latitude.  While  the  re- 
publics had  been  Spanish  provinces  under  the  imperial 
colonial  administration,  the  need  of  strict  delimitation  of 
the  frontier  had  never  been  felt,  and  when  they  won  their 
independence,  the  republican  governments  usually  tacitly 
accepted  the  old  boundaries.  The  Desert  of  Atacama,  a 
stretch  of  arid  territory  lying  along  the  Pacific  coast  be- 
tween 22°  and  27°  south  latitude,  had  been  the  ill-defined 
boundary  between  the  provinces  of  Peru  and  Chile  under 
the  Spanish  regime;  and  when  in  1825  the  Republic  of  Bo- 
livia was  created,  it  received  the  northern  portion  of  the 
desert  and  the  town  of  Cobija,  in  order  that  it  might  have 
access  to  the  sea.  The  southern  boundary  of  Bolivia  was 
no  more  accurately  located  than  that  of  the  Spanish  prov- 
ince had  been,  and  the  Chilean  constitution  of  1833  claimed 
merely  land  "from  the  Desert  of  Atacama  to  Cape  Horn" 


60  The  Economic  Causes  of  Modern  War 

— a  northern  boundary  lying  vaguely  somewhere  in  a  des- 
ert extending  over  five  degrees. 

Undetermined  as  was  the  delimitation,  it  sufficed  so  long 
as  the  Desert  of  Atacama  was  believed  to  be  waste  land 
of  no  value ;  but  in  1842,  as  the  Peruvian  guano  trade  grew, 
the  Chilean  government  dispatched  an  expedition  to  ex- 
amine the  coast  and  find  out  whether  there  was  any  guano 
in  Chilean  territory.  Immediately  after  the  explorations, 
Chilean  vessels  began  surreptitiously  loading  guano  in 
desert  territory  claimed  by  Bolivia.  The  Bolivians  now 
asserted  their  claims  to  the  desert  and  in  1866,  after 
much  disagreement,  under  the  spur  of  the  Spanish  effort 
to  win  back  the  lost  colonies,  a  treaty  fixed  the  boundary 
at  the  24°  south  latitude,  but  at  the  same  time  stipulated 
that  the  territory  between  23°  and  25°  should  be  joint 
property  of  the  two  republics,  the  revenue  on  the  mines 
and  the  guano  and  nitrate  deposits  to  be  equally  di- 
vided. The  Bolivian  government  undertook  the  collection, 
while  full  rights  of  supervision  and  inspection  were  accorded 
to  Chile. 

Such  an  agreement  speedily  led  to  disputes  and  after 
more  diplomatic  correspondence,  Chile  in  1872  renounced 
her  claims  to  revenue  on  condition  that  the  safety  of 
Chilean  capital  and  of  subjects  engaged  in  the  mines  should 
be  guaranteed.  In  1874  this  agreement  was  incorporated 
in  a  treaty.  Most  of  the  mines  were  actually  being  worked 
by  Chilean  capital  and  by  Chilean  labor. 

While  the  diplomats  were  busy,  new  nitrate  deposits  were 
discovered  in  the  desert,  which  rapidly  began  to  displace 
guano  in  the  market.  The  effect  on  the  guano  trade  of 
Peru  was  so  unfavorable  that  in  1873  the  Peruvian  Govern- 
ment, in  an  effort  to  offset  it,  restricted  the  output  of  its 
own  nitrate  mines  to  4,500,000  quintals  (hundredweight) 
yearly,  and  proposed  that  both  Chile  and  Bolivia  should 


The  Wars  of  the  World:  1878-1914  61 

restrict  their  mines  similarly,  either  by  direct  legal  limita- 
tion or  by  the  imposition  of  prohibitive  export  duties. 

This  would  have  been  highly  favorable  to  the  guano 
trade,  but  since  that  was  of  minor  importance  to  Chile  as 
compared  with  the  trade  in  nitrate,  the  suggestion  was 
refused.  Bolivia  also  declined,  maintaining  the  treaty 
obligations  which  prevented  restrictions  on  the  mines  in  her 
territory  owned  by  Chilean  subjects,  under  the  agreement 
of  1874. 

In  the  same  year,  however,  the  government  entered  into 
a  secret  treaty  with  Peru,  maintaining  the  interests  of  the 
two  states  against  Chile.1  Efforts  to  bring  the  Argentine 
Republic  into  the  coalition  failed,  although  the  relations 
between  Argentina  and  Chile  were  strained  then  and  for 
some  years  afterward  over  the  Andes  boundary  question. 

While  the  Dictator  Malgarejo  was  in  power  in  Bolivia, 
the  Compania  de  Salitre  y  Ferrocarril  de  Antafagasta  (An- 
tafagasta Saltpetre  and  Railways  Company),  a  Chilean 
corporation,  secured  from  him  a  very  generous  conces- 
sion in  the  Desert  of  Atacama.  The  successors  of  the  dic- 
tator, after  his  fall,  sought  to  reduce  this;  and  the  taxes 
that  they  fixed  upon  the  company  drew  diplomatic  pro- 
tests from  Santiago.  The  Bolivian  Government  had  im- 
posed a  tax  of  ten  centavos  per  hundredweight  on  nitrate 
exported  by  the  company,  in  lieu  of  the  previous  tax  of 
ten  per  cent  of  the  profits.  The  Chilean  protest  was  based 
on  the  Treaty  of  1874,  which  provided  that  there  should  be 
no  increase  in  the  taxes  of  citizens  of  Chile  resident  in 
Bolivia.  The  Bolivian  Government  yielded,  but  presently 
declared  the  concession  of  the  powerful  Antafagasta  com- 
pany void,  and  ordered  the  confiscation  of  its  property. 

1  The  text  of  this  treaty  is  published  twice  in  President  Arthur's  Mes- 
sage to  Congress  of  1882,  Submitting  Papers  Relating  to  the  War  in  South 
America,  pp.  85  and  208. 


62  The  Economic  Causes  of  Modern  War 

Chile  presented  a  48-hour  ultimatum,  and  at  its  expira- 
tion debarked  500  troops  at  Antafagasta.1 

The  Chilean  army  now  occupied  an  advanced  post  on 
the  Peruvian  frontier  and  within  easy  striking  distance  of 
the  important  deposits  of  nitrate  and  guano  in  the  Depart- 
ment of  Tarapaca.  The  Peruvian  Government  immediately 
offered  mediation  between  Chile  and  Bolivia. 

When  the  offer  was  first  made,  no  suspicion  existed  in 
Chile  of  the  alliance  that  had  been  formed  between  their 
economic  rival  and  the  mediating  power;  but  rumors  of 
the  secret  treaty  led  to  a  demand  upon  the  government  of 
Peru  for  a  declaration  of  neutrality  which  forced  admis- 
sion of  the  existence  of  a  treaty  which  bound  Peru  to  assist 
Bolivia.  The  war  spirit  had  been  rising  in  all  three  states. 
The  Peruvian  mediator  had  been  received  with  marked  hos- 
tility by  the  Chilean  populace.  Chile  declared  war  with 
both  Peru  and  Bolivia,  April  5,  1879. 

The  situation  had  been  complicated  by  diplomatic  ex- 
changes between  Chile  and  Argentina  over  the  Andes 
boundary  question,  which  had  led  so  close  to  war  that  the 
Chilean  fleet  actually  steamed  south  towards  the  Straits 
of  Magellan  and  was  recalled  on  the  settlement  of  the  dif- 
ficulties with  Argentina  just  in  time  to  be  turned  against 
Peru.  The  war,  after  a  few  months  land  and  sea  fighting, 
was  everywhere  a  Chilean  victory.  Chile  mastered  the  sea 
after  a  six  months  struggle.  The  Chilean  army  drove  the 
Peruvians  out  of  the  Department  of  Tarapaca,  and  in  two 
engagements  won  Tacna  and  Arica,  thus  gaining  control 
of  practically  all  of  the  nitrate  and  guano  fields.    Neutral 

'It  is  said  (Diego  Barras  Arana:  Histoire  de  la  Guerre  du  Pacifique, 
p.  50)  that  although  President  Doza  of  Bolivia  received  on  February 
20  the  news  of  the  Chilean  occupation  of  Antafagasta,  he  did  not  per- 
mit it  to  be  made  public  until  Ash  Wednesday,  six  days  later,  when  it  could 
not  interfere  with  the  pre-Lenten  carnival  period.  Only  after  that  time 
did  the  Bolivian  cabinet  begin  to  plan  a  course  of  action. 


The  Wars  of  the  World:  1878-1914  63 

efforts  at  mediation  failed.  Chile,  in  actual  possession  of 
the  nitrate  deposits,  demanded  territorial  concessions  to 
which  Peru  would  not  yield.  It  was  not  until  Lima  was 
taken  and  the  government  overthrown  that  Chile  finally 
attained  her  territorial  aspirations.  Bolivia,  in  a  separate 
peace,  gave  up  her  seacoast.  After  a  new  government  had 
been  organized  in  Peru,  the  Treaty  of  Ancon  l  was  signed, 
by  which  Tarapaca  was  ceded  unconditionally,  and  Tacna 
and  Arica  for  ten  years,  at  the  end  of  which  a  plebiscite  was 
to  be  held.  This  has  never  been  done  and  Chile  still  re- 
tains possession. 

The  conquest  has  been  of  vast  economic  value  to  Chile. 
From  1879  to  1899,  inclusive,  the  duty  on  the  nitrate  ex- 
ports alone  was  $557,033,576  in  Chilean  money  and  the 
value  of  the  exports  themselves  $1,406,741,330.2  It  has 
been  estimated  that  from  1900  to  1935  the  nitrate  export 
duties  will  reach  $1,656,200,000.  Surveys  by  the  Chilean 
government  in  1899  showed  sufficient  nitrate  in  Tarapaca 
to  permit  the  exportation  of  1,400,000  tons  a  year  for 
thirty-five  years  to  come. 

The  economic  character  of  such  a  war  is  self-evident. 
The  boundary  question  between  Chile  and  Bolivia  had  ex- 
isted for  a  long  time  without  ever  having  been  seriously 
considered,  much  less  leading  to  any  signs  of  hostilities.  It 
was  only  when  the  valuable  mineral  deposits  were  found 
that  the  states  became  sufficiently  concerned  over  their 
boundaries  to  attempt  to  fix  them,  and  the  rivalry  between 
the  miners  of  Peruvian  guano  and  Chilean  nitrate  fanned 

1  The  text  of  this  and  the  Bolivian  treaty  are  to  be  found  in  The  Ques- 
tion of  the  Pacific,  by  V.  M.  Maurtua  and  F.  A.  Pezet,  p.  139  and  p.  204, 
respectively. 

'These  figures  are  based  on  Chilean  statistics,  but  the  calculations  are 
by  the  Peruvian  Alejandro  Garland.  With  further  amplifications  they 
may  be  found  in  The  Question  of  the  Pacific,  pp.  150-151. 


64  The  Economic  Causes  of  Modern  War 

the  flames.  The  questions  discussed  in  the  diplomatic 
interchanges  that  preceded  the  war  were  wholly  economic; 
and  the  Antafagasta  incident  which  precipitated  hostilities 
at  last,  was  a  blow  by  Chile  in  defense  of  her  nitrate 
interests.  In  the  Treaty  of  Ancon,  it  was  the  possession  of 
Taena,  Arica,  and  Tarapaca,  with  their  nitrate  deposits, 
upon  which  the  victors  were  intent. 

THE    BRITISH    OCCUPATION    OF    EGYPT,    1882-1898  * 

uThe  origin  of  the  Egyptian  question  in  its  present  phase 
was  financial,"  says  the  first  sentence  of  Lord  Cromer's 
Modern  Egypt.  The  conclusion  of  the  Governor-General 
is  justified,  for  it  rests  on  a  more  thorough  acquaintance 
with  Egyptian  affairs  than  is  possessed  by  any  other  man. 
The  British  occupation  offers  one  of  the  clearest  examples 
possible  of  the  role  played  by  economics  and  finance,  and 
of  the  struggles  and  rivalries  which  grew  out  of  them,  in 
producing  wars.  The  entrance  of  the  British  came  about 
mainly  because  of  the  inability  of  the  Khedive,  Ismail 
Pasha,  to  meet  the  enormous  debts  in  which  he  had  in- 
volved himself  through  his  extravagant  luxury;  but  there 
are  other  reasons  besides  this  for  the  British  to  be  estab- 
lished in  Egypt.  One  is  directly  economic,  the  need  for  raw 
materials,  especially  cotton,  of  which  Egypt  sends  a  million 
bales  a  year  to  the  British  textile  factories,  and  which  is 
equally  desirable  either  to  the  French  or  to  the  German 
textile  mills.  The  other  is  indirectly  economic — the  old 
story  of  the  protection  of  the  highways  to  India,  which 
may  be  threatened  through  the  economic  jealousy  of 
any   power   which   holds   Egypt.    The   Suez   trade   route 

1  Though  the  actual  occupation  took  place  in  1882,  these  dates  are 
made  to  include  the  subsequent  fighting  in  the  Sudan,  which  was  the 
logical  step  following  the  occupation  and  intimately  related  to  it. 


The  Wars  of  the  World:  1878-1914  65 

antedates  the  Canal,  an  overland  road  having  been  devel- 
oped and  encouraged  under  British  auspices,  and  discour- 
aged by  the  French,  who  looked  upon  it  as  tending  to  lessen 
the  prospects  of  beginning  the  cherished  project  of  their 
great  engineer,  de  Lesseps.  The  British  hold  on  Egypt  is 
also  a  protection  to  the  colonies  elsewhere  in  Africa. 

British  interference  in  Egypt  dates  from  the  Napoleonic 
wars,  when  the  Emperor  tried  to  use  that  land  as  a  base  of 
attack  upon  India  and  British  trade  in  the  Mediterranean 
— an  attempt  which  was  frustrated  by  Nelson's  destruc- 
tion of  the  French  fleet  in  the  Battle  of  the  Nile,  and  the 
crushing  of  the  French  army  in  possession  of  the  country. 
England  again  interfered  in  1807  to  assist  the  Nationalist 
Party,  but  was  defeated  by  Mohammed  Ali,  who  had  just 
forced  the  Sultan  to  recognize  him  as  Pasha  of  Egypt. 

Ismail  Pasha,  whose  extravagance  at  last  compelled  for- 
eign intervention,  succeeded  to  the  throne  in  1863  and  re- 
ceived the  title  of  Khedive  from  the  Sultan  in  1867.  Prior 
to  his  accession  to  the  khedival  throne,  he  had  been  living 
as  a  country  gentleman  with  large  landed  estates,  to  which 
he  was  applying  the  most  modern  agricultural  methods  and 
from  which  he  was  deriving  large  returns.  His  habits  of 
luxury  and  extravagance  were  such,  however,  that  even 
when  these  profits  were  increased  by  the  revenues  of  the 
Egyptian  state,  they  were  not  sufficient.  The  tax  rose  un- 
der his  rule  from  40  to  60  piastres,  coin  by  coin  wrung  out 
under  the  lash  from  the  miserable  fellaheen,  who  were  fre- 
quently compelled  to  mortgage  their  petty  properties  to 
the  money-lenders  who  invariably  accompanied  the  tax- 
gatherers  on  their  rounds. 

Finding  the  taxes  insufficient,  Ismail  resorted  to  con- 
fiscation, in  which  indirect  methods  were  necessitated  by 
his  fear  of  the  intervention  of  European  Powers.  In  an 
Oriental  country  the  opportunities  for  coercion  and  intimi- 


66  The  Economic  Causes  of  Modern  War 

dation  are  so  extensive  that  within  a  few  years  Ismail, 
employing  methods  little  better  than  barefaced  seizure,  had 
been  able  so  to  harass  the  owners  of  estates  which  he  de- 
sired that  they  had  been  compelled  to  part  with  them  for 
practically  nothing.  In  this  way  he  had  come  into  per- 
sonal possession  of  about  one-fifth  of  the  land  of  Egypt. 

Confiscation  was  not  so  successful  a  method  of  increas- 
ing his  income  as  the  Khedive  had  hoped,  for  as  his  es- 
tates increased,  the  possibility  of  strict  oversight  of  their 
management  and  accounts  diminished,  and  he  was  so  robbed 
on  every  hand  by  his  own  administrators  that  he  found 
himself  almost  as  straitened  as  ever.  After  a  little  pre- 
liminary negotiation  with  native  money  lenders  and  with 
Greeks  in  Alexandria,  he  turned  to  Europe  for  loans. 

The  transactions  were  in  the  hands  of  Nubar  Pasha,  an 
individual  quite  devoid  of  scruple,  who  managed  the  busi- 
ness so  adroitly  that  of  the  total  of  96,000,000  pounds  ster- 
ling that  he  borrowed,  only  54,000,000  reached  the  Khedive. 
A  great  part  of  all  this  money  was  raised  in  Great  Britain, 
largely  through  the  agency  of  the  English  Rothschilds,  es- 
pecially the  loans  after  1871,  when  French  finance  was  con- 
cerned chiefly  with  paying  off  the  Prussian  indemnity.  Al- 
though the  money  was  borrowed  in  the  name  of  the 
Egyptian  government  and  became  a  part  of  the  public  debt 
of  Egypt,  almost  all  of  it  went  to  the  private  uses  of  the 
Khedive  himself. 

In  1876  the  debt  amounted  to  89,000,000  pounds  sterling, 
a  tremendous  sum  for  a  country  with  only  6,000,000  popula- 
tion and  with  an  area  of  only  5,000,000  acres  under  culti- 
vation.1 It  must  be  remembered  that  until  the  British 
came,  the  area  of  Egypt  watered  by  the  Nile  (the  only 
arable  portion)  was  comparatively  small.    Since  that  time 

'W.  Basil  Worsfold:  The  Future  oj  Egypt,  p.  44. 


The  Wars  of  the  World:  1878-1914  67 

the  building  of  the  Assouan  dam  and  the  creation  of  a 
scientific  irrigation  system  have  greatly  increased  the  pro- 
ductive capacity  of  the  country. 

In  thirteen  years,  Ismail  added  nearly  86,000,000  pounds 
to  the  debt  of  the  country,  and  had  raised  the  tax  rate 
many  times.  These  taxes  were  levied  directly  upon  the 
fellaheen,  the  native  farmers,  who  were  the  only  real  pro- 
ducers of  wealth  in  the  country,  from  whom  the  money 
was  wrung  with  the  most  systematic  brutality.  Never  was 
a  country  so  systematically  and  pitilessly  drained  of  its 
wealth.  Even  the  bits  of  gold  which  by  native  custom 
formed  the  chief  treasure  of  every  Egyptian  woman  were 
taken;  the  few  small  savings  of  the  peasants  were  gobbled 
up  by  the  rapacious  collectors;  and  the  helpless  workers, 
man  and  woman  alike,  were  set  to  work  again,  almost  upon 
the  level  of  slaves. 

Had  even  a  portion  of  the  money  thus  being  recklessly 
borrowed  abroad  and  extorted  from  the  people  at  home 
been  expended  in  public  works,  there  would  have  been  at 
least  some  defense  for  the  khedival  government,  but  this 
was  not  the  case.  With  the  exception  of  the  Suez  Canal, 
only  about  ten  per  cent  of  the  loans  ever  went  into  the 
development  of  the  country;  and  even  the  contribution 
of  3,000,000  pounds  to  the  Canal  was  made  only  after  arbi- 
tration by  Napoleon  III  when  the  government  had  failed 
to  carry  out  its  contract  to  grant  areas  of  land  and  to  supply 
forced  labor  to  the  Canal  Company. 

Evidently  this  state  of  affairs  could  not  continue  in- 
definitely. The  country  had  been  taxed  to  its  capacity,  but 
still  it  was  a  notorious  fact  that  the  revenue  was  not  meet- 
ing the  ordinary  costs  of  administration  and  at  the  same 
time  paying  the  interest  on  the  money  which  the  Khedive 
had  borrowed  in  Europe  and  squandered  on  his  private  dis- 
sipations. 


68  The  Economic  Causes  of  Modern  War 

The  obvious  thing  to  do  was  to  proclaim  openly  the  in- 
ability of  the  government  to  meet  its  obligations  and  leave 
the  European  creditors  to  make  what  terms  they  could. 
But  Egypt  was  not  an  independent  state.  It  was  bound, 
first  as  a  subject  state  of  the  Turkish  Empire,  and  second, 
by  the  special  treaties  or  "Capitulations"  *  which  granted 
special  rights  or  privileges  to  the  subjects  of  various  Euro- 
pean states  when  resident  within  Turkish  territories. 
Since  the  government  of  the  Ottoman  Empire  was  on  a 
plane  not  very  much  higher  than  that  of  Egypt,  there  was 
small  hope  that  interference  from  above  would  straighten 
out  the  tangle;  but  in  the  agreements  of  the  "Capitula- 
tions" the  European  Powers  concerned,  principally  Eng- 
land, France,  Austria,  and  Italy,  had  an  excuse  for  inter- 
fering on  behalf  of  their  investors. 

The  "Capitulations"  had  originally  been  entered  into  in 
order  to  protect  the  citizens  of  fourteen  European  Powers, 
and  of  the  United  States  and  Brazil,  when  resident  within 
the  Turkish  Empire,  from  the  maladministration  of  jus- 
tice by  the  native  courts.  An  agreement  with  the  Egyp- 
tian Government  had  about  this  time  led  to  the  establish- 
ment of  a  court  which  combined  the  authority  of  the 
various  consular  courts  in  tribunals  of  a  new  sort,  known 
as  the  Tribunaux  Mixtes,  constituted  by  khedival  decree  on 
January  1,  1876,  and  given  jurisdiction  in  civil  cases  as  well 

*The  first  of  these  treaties  was  made  with  France  in  1536  (renewed 
1673  and  1740),  when  the  Turkish  Empire  was  at  the  height  of  its  powers. 
The  second  was  with  England  in  1583,  followed  by  others  granted  to 
Holland  in  1613,  Austria  in  1718  (renewed  1784),  and  Russia  in  1784. 
During  the  Eighteenth  Century  nearly  every  European  Power  secured  a 
Capitulation,  and  during  the  Nineteenth  Century  the  new  states,  Bel- 
gium, Greece,  and  the  United  States,  also  secured  them.  Though  the 
treaties  differ  in  minor  details,  their  provisions  are  in  general  the  same: 
liberty  of  residence,  inviolability  of  domicile,  liberty  to  travel,  freedom  of 
commerce  and  religion,  immunity  of  local  jurisdiction,  and  exclusive  extra- 
territorial jurisdiction  over  foreigners  of  the  same  nationality. 


The  Wars  of  the  World:  1878-1914  69 

as  in  the  criminal  cases  with  which  alone  the  consular 
courts  had  concerned  themselves.  The  authority  was  to 
extend  to  cases  at  law  between  natives  and  foreigners. 

At  the  same  time  an  effort  by  the  Powers  to  ascertain 
the  exact  condition  of  the  finances  of  Egypt — known  to 
be  unsatisfactory — led  to  the  Cave  Report,  presented  in 
March,  1876,  incomplete  but  sufficient  to  demonstrate  the 
need  of  international  action  of  some  kind  in  order  to  pro- 
tect the  European  creditors  of  Egypt  by  receiving  as  a 
whole,  the  revenues  that  the  Khedive  had  set  aside  to  meet 
the  debt.  With  this  object  in  view,  the  Khedive  author- 
ized on  May  2,  1878,  the  Caisse  de  la  Dette,  which  was 
made  up  in  the  beginning  of  three  officials  representing 
France,  Austria,  and  Italy. 

The  concerted  action  of  the  Powers  in  establishing  these 
two  international  authorities  improved  the  situation  so  far 
as  the  creditors  of  Egypt  were  concerned,  for  not  only  was 
the  revenue  for  the  payment  of  the  debt  to  be  more  hon- 
estly and  efficiently  administered;  but  in  the  future  com- 
plaints which  might  be  brought  against  the  Egyptian  Gov- 
ernment would  be  tried  before  a  court  which  derived  its 
authority  not  from  that  government  itself,  but  from  Eu- 
rope. This  was  the  peculiar  importance  of  the  Tribunaux 
Mixtes. 

As  the  bad  faith  of  Ismail  became  more  and  more  ap- 
parent, England  and  France,  which  were  most  concerned 
in  the  Suez  Canal  and  in  the  development  of  Egypt  in  gen- 
eral, interfered  directly  in  the  administration  of  the  coun- 
try; and  created  the  Goschen-Joubert  mission  to  re-exam- 
ine the  financial  situation  and  find  a  way  of  paying 
off  the  debt.  A  plan  was  submitted  in  November,  only 
to  be  found  useless  because  of  the  deception  practiced  by 
Ismail,  who  had  furnished  false  data.     In  1878  the  inves- 


70  The  Economic  Causes  of  Modern  War 

tigation  of  a  Commission  armed  with  full  powers  to  ex- 
amine every  detail  of  Egyptian  finance,  including  the 
sources  of  revenue  and  the  methods  of  administration, 
showed  clearly  that  Ismail  would  never  be  able  to  meet 
the  obligations  of  the  state.  The  Khedive  having  been  so 
indiscreet  as  to  attempt  obduracy  before  the  European 
proposals  for  reducing  the  interest  due  on  the  debt,  was 
deposed  by  international  action  in  June,  1879,  and  his  son 
Tewfik  Pasha  put  in  his  place. 

After  Ismail  had  been  deposed,  England  and  France 
jointly  assumed  responsibility  for  the  control  of  the  na- 
tive government  in  Egypt,  and  Tewfik  Pasha1  was  given 
to  understand  that  no  other  Powers  would  be  allowed  to 
interfere.  The  recommendations  which  had  been  made  by 
the  Financial  Commission  were  followed  out  and  a  Law  of 
Liquidation  was  passed  which  remained  in  force,  with 
slight  modifications,  made  in  1885,  until  1904.  When  the 
decree  of  the  Khedive  promulgated  the  new  law  with  the 
approval  of  the  governments  of  England,  France,  Austria, 
Germany,  Italy,  and  Russia  in  1880,  it  had  been  found 
that  since  1876  the  debt  had  been  increased  by  nearly 
10,000,000  pounds,  making  a  total  of  98,376,660  pounds. 
This  sum  was  divided  into  four  debts,  which  stood  at  the 
following  figures  in  1881 :2 

*In  Moslem  countries  descent  is  ordinarily  to  the  oldest  living  male 
member  of  the  family,  according  to  Turkish  law.  A  Firman  of  the  Sublime 
Porte,  May  27,  1866,  had  substituted  father-to-son  descent  by  primogeni- 
ture, in  the  special  case  of  the  hereditary  rulers  of  Egypt. 

2W.  Basil  Worsfold:  The  Future  oj  Egypt,  p.  50.  Before  the  World 
War  upset  exchange  values,  the  Egyptian  pound  was  the  equivalent  of 
$4.94307  in  American  money,  as  compared  with  an  equivalent  value  of 
$4.86656  for  the  pound  sterling.  The  Egyptian  coinage  is  used  only  in 
Egypt,  and  the  pound  is  divided  into  100  piastres  of  ten  ochr-el-guereh, 
each  of  four  paras.  It  contains  7.4375  grammes  of  fine  gold  as  compared 
with  7.32238  grammes  in  the  pound  sterling.  See  V.  Gonzales:  Modern 
Foreign  Exchange,  p.  19. 


The  Wars  oj  the  World:  1878-1914  71 


In  pounds  sterling 

In 

pounds  Egx 

Capital  Amount 

Rate 

Interest 

Privileged  Debt  ....22,587,800 

5% 

1,157,024 

Unified   Debt    57,776,340 

4% 

2,253,265 

Domains  Loan  8,499,620 

5% 

455,310 

Daira  Debt   9,512,900 

4% 

370,322 

98,376,660  4,235,921 

In  addition  to  these  sums,  Egypt  was  made  liable  to 
an  additional  sum  of  1,000,000  pounds  a  year,  called  for  by 
the  tribute  to  Turkey,  interest  due  England  on  the  Suez 
Canal  shares,  and  minor  obligations  not  included  in  the 
Consolidated  Debt. 

This  arrangement  left  the  Egyptian  government  with  an 
annual  income  of  less  than  4,000,000  pounds  above  the 
charges,  with  which  to  carry  on  the  business  of  the  coun- 
try.   The  revenues  and  charges  stood  as  follows:1 

Total  receipts  from  all  sources  9,229,965  pounds 

Charges  for  debt  and  tribute   5,345,341       " 


Balance   available    3,884,624       " 

By  1880,  the  sum  of  1,000,000  pounds  had  been  paid  off 
the  debt,  but  the  sweeping  economics  and  retrenchments 
necessary  to  accomplish  this  and  the  impossibility  of  re- 
lieving the  taxpayers  of  their  burdens,  led  to  an  identifica- 
tion in  the  popular  mind  of  the  Europeans  with  the  Turkish 
oppressors,  and  the  national  movement,  originally  anti- 
Turkish,  broke  out  in  a  fierce  revolt  against  the  Dual  Con- 
trol. Headed  by  Arabi  Pasha,  the  Egyptian  Minister  of 
War,  and  deriving  support  among  the  people  from  the  wave 
of  Mohammedan  fanaticism  soon  to  sweep  the  Sudan  under 
the  Mahdi,  the  rebellion  reached  such  proportions  that  the 
khedival  government  and  everything  that  the  French  and 
British  had  been  able  to  accomplish,  was  threatened. 

^bid.,  p.  51. 


72  The  Economic  Causes  of  Modern  War 

After  a  massacre  at  Alexandria  in  which  fifty  Christians 
were  killed,  the  British  fleet  bombarded  the  city.  On  the 
22nd  the  Khedive  dismissed  Arabi  from  office  and  the  min- 
ister promptly  declared  a  Holy  War  on  his  own  responsi- 
bility. Between  August  3rd  and  26th,  the  British  took 
possession  of  the  Suez  Canal  completely — the  coveted  di- 
rect route  to  India — and  troops  were  sent  in  from  Malta, 
Cyprus,  India,  and  England.  Lord  Wolseley  landed  at 
Alexandria  August  13th,  proclaimed  that  he  was  there  to 
uphold  the  authority  of  the  Khedive,  and  on  September 
13th  crushed  the  Egyptian  army  at  Tel-el-Kebir.  Cairo 
was  taken  the  next  day  and  the  British  occupation  had 
begun. 

France  and  Italy  *  had  both  declined  to  accept  the  invi- 
tation of  Great  Britain  to  participate;  and  the  entrance  of 
the  British  therefore  put  an  end  to  the  Dual  Control,  leav- 
ing the  responsibility  for  the  administration  of  the  state 
in  their  hands.  The  situation  was  further  complicated  by 
the  fact  that  Egypt  had  during  all  this  time  been  a  subject 
state  of  the  Turkish  Empire,  with  which  Great  Britain  at 
that  time  still  desired  to  maintain  friendly  relations,  in 
order  to  keep  Russia  out  of  Constantinople  and  away  from 
the  all-important  route  to  India. 

The  British  occupation  was  declared  to  have  been  under- 
taken solely  to  "restore  the  authority  of  the  Khedive"; 
but  since  the  only  authority  left  to  that  unhappy  official 
had  come  to  be  exercised  through  the  medium  of  the  Dual 
Control,  the  occupation  actually  meant  that  henceforward 
Britain  would  rule  in  Egypt.     The  French  were  jealous  of 

1  Italian  popular  sympathy  at  this  time  was  all  with  the  Egyptians,  and 
an  Italian  legion  was  actually  being  raised  by  Menotti  Garibaldi  to  aid 
the  Egyptians  in  their  struggle  for  freedom  from  foreign  control.  A 
decided  coolness  between  the  two  states  existed  for  several  years  after 
the  occupation. 


The  Wars  of  the  World:  1878-1914  73 

British  occupancy  and  continued  to  protest  at  intervals 
until  the  agreement  of  1904.  On  January  3,  1883,  Lord 
Grenville,  then  Minister  for  Foreign  Affairs,  addressed  a 
communication  to  the  Powers  in  which  he  said: 

"Although  for  the  present  a  British  force  remains  in  Egypt 
for  the  preservation  of  public  tranquillity,  Her  Majesty's  Gov- 
ernment are  desirous  of  withdrawing  it  as  soon  as  the  state  of 
the  country  and  the  organization  of  proper  means  for  the  main- 
tenance of  the  Khedive's  authority  will  permit  of  it.  In  the 
meantime,  the  position  in  which  Her  Majesty's  Government  are 
placed  towards  His  Highness  imposes  upon  them  the  duty  of 
giving  advice  with  the  object  of  securing  that  the  order  of  things 
to  be  established  shall  be  of  a  satisfactory  character  and  pos- 
sess the  elements  of  stability  and  progress." 

A  year  later  the  Egyptian  Government  was  given  to  un- 
derstand that  the  "advice"  which  it  received  from  Great 
Britain  must  be  regarded  as  compulsory.  After  this  the 
position  of  Egypt  was  wholly  anomalous,  for  the  Khedive, 
though  ruling  a  dependency  of  the  Turkish  Empire,  and 
owning  allegiance  to  the  Sultan,  could  take  no  steps  with- 
out the  approval  of  the  British. 

More  war  was  to  follow.  The  immense  region  to  the 
south  of  Egypt,  the  Sudan,  never  very  completely  under 
khedival  control,  broke  into  revolt,  the  tribesmen  having 
been  inflamed  by  a  religious  leader  who  proclaimed  himself 
a  Mahdi  or  Savior.  The  inefficient  force  of  Egyptian  sol- 
diery together  with  a  small  British  force  under  General 
Hicks  was  cut  to  pieces.  In  1884  General  Gordon,  an  Eng- 
lish soldier  of  eccentric  magnetic  qualities  calculated  to 
appeal  to  the  public,  and  of  a  great  deal  of  experience  in 
dealing  with  native  tribes,  was  sent  almost  alone  into  the 
Sudan  with  the  idea  that  he  would  be  able  to  restore  Brit- 
ish control.    On  his  arrival  at  Khartoum  he  discovered  that 


74  The  Economic  Causes  of  Modern  War 

the  situation  was  far  worse  than  had  been  represented,  and 
almost  immediately  afterward  found  himself  besieged  by 
the  Mahdi  and  his  fanatic  dervishes. 

The  popular  voice  in  England  demanded  a  relief  expe- 
dition, but  the  government  was  so  dilatory  and  hesitant 
that  none  was  started  until  September,  1884.  Pushing  for- 
ward under  great  difficulty,  it  reached  Khartoum  January 
28,  1885,  two  days  after  the  city  had  been  taken  and  Gor- 
don, with  all  his  men,  massacred. 

After  this  there  was  no  more  warfare  in  connection  with 
the  British  occupation  until  1896,  the  Sudan  was  aban- 
doned, and  the  occupation  was  confined  to  improving  the 
financial,  economic,  and  social  conditions  of  the  Khedive's 
dominions.  In  this  year,  General  Sir  Herbert  Kitchener 
(afterward  Lord  Kitchener  of  Khartoum)  was  sent  into  the 
Sudan  with  20,000  troops  to  reconquer  it  for  the  Khedive, 
a  task  which  he  accomplished  after  two  years  of  fighting. 

That  the  colonial  rivalries  of  France  and  Britain  did  not 
at  this  time  result  in  war  was  due  wholly  to  the  internal 
political  conditions  of  France,  divided  into  two  bitterly  op- 
posed factions  after  the  revelations  of  the  Dreyfus  trial. 
The  French  had,  in  the  hope  of  taking  advantage  of  con- 
ditions in  the  Sudan  to  round  out  their  colonial  domain, 
sent  Major  Marchand  with  only  eight  officers  and  one  hun- 
dred twenty  men  from  the  Upper  Congo,  with  orders  to 
traverse  the  district  intervening  and  stop  at  the  Nile.  Ac- 
complishing his  mission  successfully,  the  French  officer  ar- 
rived at  the  little  town  of  Fashoda  (the  present  Kodok) 
in  July,  1898.  Two  months  later  Kitchener's  army,  fresh 
from  its  victory  over  the  Mahdi,  marched  in  from  the  south 
and  raised  the  British  flag  not  more  than  a  thousand  yards 
from  the  headquarters  of  Major  Marchand. 

Asserting  the  authority  of  the  Khedive,  Kitchener  di- 
rected Marchand  to  haul  down  his  flag  and  leave  the  ter- 


The  Wars  of  the  World:  1878-1914  75 

ritory,  to  which  the  French  commander  replied  that  he 
received  his  orders  from  his  military  superiors  and  could 
not  leave  without  their  direction.  The  issue  thus  passed 
to  London  and  Paris.  The  French  ministry  asserted  that 
the  Khedive  had  lost  his  rights  in  the  Sudan  by  allowing 
the  Mahdists  complete  sway  for  an  entire  decade,  and  that 
therefore  Great  Britain  could  have  no  claim.  The  English 
laid  claim  to  the  entire  Nile  Valley,  in  the  name  of  the 
Khedive,  and  held  that  the  suppression  of  the  revolt  by 
Kitchener's  army  constituted  a  full  and  valid  claim  to  re- 
main in  possession.  Here  was  a  clear  case  of  the  clash  of 
colonial  interests  of  two  Powers,  both  led  to  seek  expansion 
because  of  economic  pressure  at  home. 

Popular  opinion  was  aroused  to  a  pitch  which  made  war 
seem  inevitable;  but  in  the  end  France  had  to  yield,  and 
the  respective  spheres  of  influence  were  delimited  by  an 
agreement  of  March  21,  1899,  which  secured  to  the  British 
an  undisputed  influence  throughout  Egypt. 

Until  1904,  when  England  and  France  once  for  all  ad- 
justed their  colonial  rivalries  and  ambitions,  the  French 
looked  with  jealous  eyes  upon  the  English  occupancy,  es- 
pecially as  the  land  came  more  and  more  to  be  in  fact  a 
real  possession  of  the  British  Crown,  in  spite  of  its  nominal 
acknowledgment  of  Turkish  suzerainty.  After  the  agree- 
ment in  1904,  this  jealousy  ceased,  and  France  no  longer 
asked  embarrassing  questions  with  regard  to  the  reiterated 
British  intention  of  leaving  Egypt  to  itself.  The  British 
were  in  possession,  and  the  British  meant  to  stay.  War 
with  Turkey  at  last  afforded  an  excuse  for  ending  the  fic- 
tion of  dependence  upon  the  Ottoman  Empire;  and  Egypt 
at  last  became  in  name  as  she  had  been  in  fact  for  years, 
a  dependency  of  Great  Britain. 

The  occupation  of  Egypt  by  the  English,  together  with 
the  fighting  which  it  caused,  first  with  the  Egyptian  army 


76  The  Economic  Causes  of  Modern  War 

and  later  with  the  Mahdi  and  his  followers  in  the  Sudan, 
is  clearly  economic  and  financial  in  its  origin,  as  Lord 
Cromer  said.  Undertaken  as  a  means  of  settling  the  rival 
claims  to  payment  of  the  creditors  of  the  various  coun- 
tries who  were  interested  in  the  Egyptian  Debt,  it  led  to  a 
permanent  hold  upon  a  country  which  aided  England  in 
the  quest  of  raw  materials  for  her  textile  industry — soon 
to  be  hard  pushed  by  German  rivalry — and  made  still  more 
complete  the  jealous  hold  upon  India  which  guarded  it 
from  dangerous  economic  rivals;  and  it  facilitated  the  de- 
fense of  other  African  possessions.  The  occupation  is  but 
one  more  in  the  long  series  of  similar  exploits  to  which  Euro- 
pean states  have  been  driven  in  their  dealings  with  weaker 
nations  because  of  their  economic  needs  and  economic  ri- 
valries. 

SERBO-BULGARIAN   WAR,   1885 

The  wars  and  constant  prospects  of  wars  in  the  Balkans, 
which  have  kept  Europe  in  a  turmoil  during  the  last  half 
century  and  which  contributed  to  the  great  catastrophe  of 
the  late  war,  are  due  very  largely  to  racial,  territorial,  re- 
ligious, and  political  motives,  but  the  economic  element 
is  not  lacking.  The  Balkan  states  have  fought  because 
they  liked  to  fight,  because  they  were  jealous  of  one 
another,  because  they  sought  territorial  expansion  in  order 
to  bring  a  single  race  under  a  single  government  of  its 
own ;  but  they  have  not  fought  over  colonies  or  trade  routes,, 
or  spheres  of  influence,  or  naval  bases. 

It  has  been  the  economic  rivalries  of  other  nations,  find- 
ing expression  in  the  Balkans,  rather  than  economic  rival- 
ries among  the  Balkan  states  themselves  which  have  stirred 
up  a  large  proportion  of  the  trouble  which  has  led  to  wars  in 
this  turbulent  portion  of  the  globe. 


The  Wars  of  the  World:  1878-1914  77 

The  war  between  Serbia  and  Bulgaria  in  1885  at  first 
sight  appears  to  have  little  to  do  with  illustrating  the 
economic  causation  of  war.  It  arose  through  Serbian 
jealousy  of  the  expansion  of  Bulgaria.  At  the  Congress 
of  Berlin,  it  will  be  remembered,  the  provisions  of  the 
Treaty  of  San  Stefano,  which  gave  Eastern  Rumelia  to  Bul- 
garia, were  withdrawn,  and  Bulgaria  was  restricted  to  nearly 
her  old  boundaries.  In  1885  the  Rumelians,  who  were  Bul- 
garian by  blood  and  restive  under  Turkish  rule,  and  who 
had  long  been  desirous  of  amalgamation  with  Bulgaria, 
arrested  their  Turkish  governor-general  and  issued  a  proc- 
lamation declaring  the  union  of  the  two  Bulgarias.  Prince 
Alexander,  hesitating  to  defy  Turkey,  was  at  length  pre- 
vailed upon  not  to  follow  his  first  inclination  to  seek  the 
Sultan's  consent ;  and,  yielding  to  the  evident  wishes  of  his 
people,  marched  to  Philippopolis  and  declared  it  a  part  of 
his  kingdom. 

Turkey  at  first  threatened  war,  and  Greece  and  Serbia 
began  to  mobilize.  The  latter  state  was  at  first  believed  to 
be  preparing  to  attack  Turkey,  and  it  was  not  until 
a  very  short  time  before  the  opening  of  hostilities  that  the 
Bulgars  realized  that  King  Milan  was  in  fact  preparing 
to  make  war  upon  them.  The  enlargement  of  Bulgaria  by 
the  addition  of  Rumelia  had  been  so  great  that  the  other 
two  states  felt  that  they  would  be  outshadowed  unless  they 
also  received  territorial  compensations.  Certainly  the  new 
Bulgaria  was  large  enough  to  deprive  Serbia  of  any  pre- 
tensions to  hegemony  in  the  Balkans  that  she  may  have 
entertained. 

The  war  was  very  brief.  When  it  was  realized  at  Sofia 
that  a  Serbian  attack  was  imminent,  troops  were  hurriedly 
sent  to  the  border.  On  the  14th  of  November,  1885,  the 
Serbians  advanced  across  the  frontier,  forced  the  Dragoman 
Pass  on  the  15th,  and  reached  the  plain  of  Sofia  on  the 


78  The  Economic  Causes  of  Modern  War 

16th.  In  the  meantime,  a  large  part  of  the  Bulgarian  army- 
had  been  held  on  the  Turkish  frontier  to  await  develop- 
ments, until  the  Sultan  made  it  clear  that  he  did  not  intend 
war.  From  the  17th  to  the  19th  the  Battle  of  Slivnitza 
raged,  at  the  end  of  which  the  Serbians  were  driven  off 
with  heavy  losses.  At  the  end  of  the  battle,  fresh  troops 
from  Rumelia  came  up.  The  Serbians  were  swiftly  pur- 
sued, the  Dragoman  Pass  retaken,  and  the  last  stand  of  the 
invaders  crushed  at  the  Battle  of  Picot,  November  26-27th. 
The  next  day,  as  the  victorious  Bulgarians  were  beginning 
to  carry  the  war  into  Serbia,  the  Austrian  minister  to  Bel- 
grade appeared  with  an  armistice  agreement,  and  the  inti- 
mation that  Austria  was  prepared  to  come  to  Serbia's  as- 
sistance if  the  Bulgarians  did  not  grant  peace.  The  war 
ended. 

This  brief  conflict  is  not  so  free  from  economic  rivalry 
as  at  first  appears.  The  Austrian  desire  to  protect  the  de- 
feated Serbians  was  largely  due  to  the  fear  of  Bulgarian 
success  as  a  probable  expansion  of  the  Russian  sphere  of 
influence  in  the  Balkans,  where  the  Dual  Monarchy  was 
even  then  finding  some  of  her  most  valuable  markets.  Ser- 
bia, moreover,  was  one  of  the  most  exclusively  Austrian 
markets  and  as  such  had  a  distinct  claim  upon  the  larger 
state  at  that  time.  Thus  even  in  the  welter  of  racial  and 
religious  hatreds  in  the  Balkans,  economic  factors  find  a 
place. 

THE  ABYSSINIAN   WARS  OF  1887   AND   1896 

The  two  wars  waged  by  Italy  in  an  effort  to  establish  a 
colonial  empire  in  Africa  at  the  expense  of  Abyssinian  inde- 
pendence are  economic  wars,  as  colonial  wars  must  always 
be.  They  are  the  outcome  of  the  fierce  economic  rivalry 
of  Europe  which  found  its  expression  in  the  mad  scramble 


The  Wars  of  the  World:  1878-1914  79 

for  colonies,  following  the  opening  up  of  Africa  so  rapidly 
that  Italy  presently  found  herself  with  a  grave  overpopula- 
tion problem,  while  most  of  the  territory  of  the  world 
available  for  expansion  was  rapidly  being  pre-empted. 

The  Abyssinian  wars  are  unsuccessful  wars  and  they  are 
the  outcome  of  an  unsuccessful  colonial  policy  which  had, 
up  to  1906,  cost  the  state  a  total  of  17,591,567  pounds  ster- 
ling, with  comparatively  little  return. 

While  the  partitioning  of  Africa  had  been  in  progress, 
Italy  had  looked  on  with  longing  eyes,  until  in  1884  an 
indirect  intimation  was  given  by  the  British  Foreign  Of- 
fice that  Italian  occupation  of  territory  on  the  littoral  of 
the  Red  Sea  would  not  be  opposed.  Secured  on  land  by 
the  power  of  the  Triple  Alliance  and  at  sea  by  the  prom- 
ise of  British  support,  Italy  felt  safe  in  putting  into 
effect  a  colonial  policy  of  her  own,  born  of  the  desire  to 
share  in  the  economic  rivalry  and  colonial  profits  of  the 
great  Powers  of  the  world. 

In  1885  two  points  were  occupied,  Beilul  and  Massowa, 
with  the  British  man-of-war  "Condor"  standing  by  to  ob- 
serve and  report  what  went  on,  but  in  opposition  to  the 
advice  specifically  given  to  the  Italian  Consul-General  in 
Egypt  by  Lord  Cromer.  Encroachments  on  Abyssinian 
territory  called  forth  protests  from  the  Ethiopian  King 
John  and  in  1887  500  Italian  soldiers  were  wiped  out  by 
the  Abyssinians  at  Dogali.  A  punitive  force  of  20,000  sent 
out  from  the  colony  accomplished  little,  suffered  much 
from  fever,  and  was  at  length  recalled.  When  King  John 
died  in  1889,  Italian  influence  was  promised  to  Menelik  of 
Shoa,  one  of  the  aspirants  to  the  crown,  in  return  for  his 
favor;  and  Italy,  feeling  secure  in  her  new  possessions, 
established  the  new  colony  of  Eritrea.  Victories  over  the 
natives  followed  at  Agordat  in  1893,  Cassala  in  1894  and 
Senafe  in  1895.     The  continued  encroachments  of  the  Ital- 


80  The  Economic  Causes  of  Modern  War 

ians  were  rousing  resentment  among  the  Abyssinians,  so 
that  by  the  end  of  the  year,  large  native  armies  were  threat- 
ening the  outposts  of  the  colony,  a  force  of  2,350  Italians 
had  been  routed,  and  the  garrison  at  Makala  was  forced 
to  surrender. 

In  the  Battle  of  Adowah,  March  1,  1896,  General  Bara- 
tieri,  governor  of  the  colony,  was  completely  defeated  by 
King  Menelik,  with  a  loss  of  nearly  5,000  killed,  including 
two  generals,  and  more  than  1,500  captured. 

Italy  was  unable  to  make  further  attempts  against  the 
integrity  of  Abyssinian  territory  and  in  1906  an  agreement 
between  France,  Great  Britain,  and  Italy  finally  settled 
the  limits  of  the  colony.  All  in  all,  Italy's  colonial  ven- 
ture has  been  a  failure  economically,  having  served  none  of 
the  purposes  of  a  colony  and  having  cost  dearly  in  blood 
and  in  treasure. 

Eritrea  does  not  attract  the  Italian  emigrant,  for  of  the 
300,000  inhabitants  only  2,800  are  Europeans.  It  does  not 
produce  revenue,  but  on  the  contrary  drains  the  treasury 
at  a  rate  of  about  320,000  pounds  a  year.1  The  exports  and 
imports  are  not  sufficient  to  be  profitable. 

Although  the  economic  ends  of  the  Italian  colonial  wars 
prior  to  the  occupation  of  Tripoli  in  1911  were  not  achieved, 
the  causes  of  the  wars  remain  clear  enough.  Italy  sought 
economic  expansion  with  the  same  motives  and  the  same 
methods  as  the  other  European  Powers,  and  though  the 
Italians  failed  in  their  attempts  in  Abyssinia,  their  eco- 
nomic motives  remained  to  find  expression  later  in  the  more 
successful  war  in  Tripoli.  The  unfortunate  Abyssinians  who 
died  defending  their  native  country  were  merely  a  few  more 
natives  suffering  because  of  the  need  for  economic  expan- 
sion among  European  states. 

1  Cambridge  Modern  History,  vol.  xii  "The  Latest  Age,"  p.  271. 


The  Wars  of  the  World:  1878-1914  81 

THE  FRENCH   WARS  IN  ANNAM,   1882-1885 

The  desultory  warfare  which  went  on  intermittently  be- 
tween the  French  colonial  troops  and  the  natives  of  Annam 
between  1874  and  1882  was  a  natural  result  of  the  French 
penetration  of  this  country  in  their  effort  to  build  up  and 
strengthen  the  Indo-Chinese  colonies.  All  Europeans  had 
been  expelled  from  Annam  in  1824;  but  the  conclusion  of 
the  Anglo-French  campaign  in  China,  which  ended  in  the 
Treaties  of  Tientsin  in  1858,  offered  excuse  for  a  second 
expedition  for  the  capture  of  Sagon,  where  the  French  es- 
tablished themselves  in  1859,  employing  it  as  a  base  for  the 
spread  of  their  power  through  the  rest  of  Indo-China. 

Fighting  with  the  Annamese  in  1873  resulted  in  a  treaty 
in  the  following  year,  made  without  reference  to  the  suze- 
rain power  of  China,  which  promised  toleration  of  mis- 
sionaries and  the  internal  peace  of  the  country.  Further 
difficulties  of  the  missionaries  provided  a  convenient  ex- 
cuse for  the  extension  of  imperial  boundaries,  with  the 
result  that  in  1882  French  troops  again  interfered. 

The  Chinese  unofficially  encouraged  irregular  troops 
known  as  the  "Black  Flags"  to  aid  the  forces  of  the  An- 
namese; and  as  the  French  came  to  realize  this,  their  pro- 
posals were  made  both  directly  to  Pekin  and  to  the 
Annamese,  in  the  first  case  for  the  cession  of  the  southern 
part,  and  in  the  latter  for  the  cession  of  all  of  Tonkin. 

The  treaty  was  finally  concluded  with  the  Annamese,  but 
without  approval  from  the  Chinese  imperial  government, 
which  eventually  repudiated  it  entirely.  French  troops  at- 
tacked the  city  of  Sontai  in  spite  of  warning  that  the  Chi- 
nese would  regard  this  as  an  act  of  war.  Almost  immedi- 
ately afterward,  the  invaders  also  seized  the  towns  of  Hanoi 
and  Haiphong.    The  Annamese  now  renewed  their  war 


82  The  Economic  Causes  of  Modern  War 

against  France,  while  negotiations  for  peace  with  the  Chi- 
nese were  progressing. 

An  agreement  had  been  reached  and  peace  was  believed 
to  have  been  secured  when  a  misunderstanding  with  regard 
to  the  frontier  between  French  and  Chinese  troops  pre- 
cipitated an  engagement  in  which  the  French  were  defeated. 
A  fleet  promptly  blockaded  the  coast  of  Formosa  and  fired 
upon  Chinese  vessels  at  Foo-Chow.  The  French  repre- 
sentative at  Pekin  retired  to  Shanghai,  while  Chinese  forces 
were  pouring  into  Tonkin.  The  French  were  finally  victo- 
rious, and  a  protocol  signed  April  4,  1885,  gave  France  a 
protectorate  in  Tonkin  and  charged  her  with  the  mainte- 
nance of  order  there. 

Until  1896  the  French  Indo-Chinese  possessions  were  a 
useless  burden  and  a  heavy  drain  on  the  exchequer  of  the 
republic;  but  with  the  appointment  of  M.  Doumer  as  Gov- 
ernor-General, reforms  began  which  placed  the  colony  on 
a  sound  financial  basis.  The  foreign  trade  increased  be- 
tween 1893  and  1902  from  162,000,000  francs  to  400,000,- 
000 ;  and  the  share  of  this  which  France  received  grew  from 
30,000,000  or  less  than  a  fifth,  to  148,000,000  or  more  than 
a  third.1 

This  petty  colonial  war  is  another  example  of  the  ex- 
tension by  force  of  arms  of  the  boundaries  of  an  industrial 
state  for  economic  ends.  In  Annam  the  expansion  met 
with  eventual  success,  although  at  first  apparently  doomed 
to  a  failure  similar  to  that  of  Italy  in  Abyssinia.  It  is  the 
first  of  the  four  wars  in  the  Far  East  since  1878,  in  all  of 
which  the  effects  of  economic  pressure  either  in  Europe  or 
Japan  are  to  be  seen. 

1  These  figures  are  from  the  Cambridge  Modern  History,  vol.  xii,  The 
Latest  Age,  p.  528. 


The  Wars  of  the  World:  1878-1914.  83 

CHINO- JAPANESE  WAR,   1894-1895 

Jutting  out  between  the  Japan  Sea  and  the  Yellow  Sea, 
the  southern  extremity  of  Korea  approaches  so  close  to 
the  Mikado's  territory  that  a  powerful  enemy,  once  estab- 
lished there,  may  absolutely  and  completely  dominate 
Japan,  since  whoever  holds  Korea  can  in  a  few  hours  trans- 
port his  troops  across  the  narrow  strait  for  the  invasion 
of  the  islands.  A  naval  Power,  moreover,  established  in 
Korea,  dominates  the  Yellow  Sea  and  the  Sea  of  Japan, 
and  is  able  to  select  its  time  and  hour  to  strike  at  any 
place  along  the  Japanese  coast.  The  peninsula  is  there- 
fore, in  the  hackneyed  phrase,  "a  dagger  pointed  at  the 
heart"  of  Japan;  and  its  possession  is  indispensable  to 
Japanese  security. 

But  the  economic  importance  of  Korea  to  the  expanding 
island  Empire  far  exceeds  the  military,  for  Japan,  since  the 
awakening,  has  afforded  a  perfect  example  of  the  effects 
of  increasing  population,  followed  by  food  shortage,  excess 
of  production,  and  the  consequent  demand  for  territorial 
expanse  with  a  view  to  securing  foodstuffs,  raw  materials, 
markets,  and  room  for  colonial  territory  to  relieve  the  sur- 
plus population  of  the  fatherland.  Korea  offered  the  most 
logical  ground  for  the  expansion  of  the  Island  Kingdom. 
It  offered,  too,  a  stepping-stone  to  Manchuria  and  the  limit- 
less Siberian  wheat  fields  beyond.  Its  geographical  posi- 
tion made  it  practically  a  part  of  the  chain  of  islands  which 
constitute  the  Mikado's  dominions.  It  offered  room  for 
colonization,  it  was  rich  in  natural  resources,  and  it  was 
inhabited  by  a  gentle  race  easily  to  be  dominated  by  the 
sturdy  and  vigorous  islanders  who  coveted  it.  There 
were  3,185,000  acres  of  cultivated  land,  and  3,500,000  acres 
arable  but  as  yet  not  under  cultivation.    The  crops  could 


84  The  Economic  Causes  of  Modern  War 

be  increased  150,000,000  yen  by  the  application  of  scientific 
methods,  and  could  support  an  additional  population  of 
from  five  to  six  millions.1  Such  a  land  was  a  tempting 
prize  for  any  Power,  and  especially  to  a  nation  gradually 
beginning  to  feel  the  need  for  expansion. 

This  was  the  logic  of  the  situation  as  it  began  to  be  clear 
to  the  leaders  of  the  Japanese  in  the  years  before  the  Chi- 
nese War  and  as  it  became  increasingly  clear  during  the 
years  between  that  first  conflict  and  the  death  grapple  with 
the  Russian  Bear. 

The  Chinese  Empire  laid  claim  to  suzerainty  over  Korea. 
As  in  Annam,  this  suzerainty  had  been  asserted  with  vary- 
ing degrees  of  strictness,  but  had  come  to  amount  to  little 
more  than  the  sending  of  tribute  to  the  Chinese  capital. 
Indeed,  Korea  had  at  one  time  acknowledged  the  suze- 
rainty of  China  and  Japan  simultaneously  and  had  contin- 
ued still  to  submit  to  the  government  of  her  native  em- 
perors ! 

Realizing  the  weakness  of  the  Koreans,  the  Japanese  in- 
sisted upon  treating  with  them  as  with  an  independent 
state,  since  it  would  be  perfectly  possible  to  coerce  the 
native  government  into  granting  whatever  trading  priv- 
ileges were  desirable  and  probably  eventually  to  find  pre- 
texts for  interfering  with  the  internal  affairs  of  the  penin- 
sula and  assuming  the  reins  of  government.  All  of  this 
was  impossible  so  long  as  the  Hermit  Kingdom  was  for- 
mally recognized  as  a  tributary  of  the  Chinese  Empire. 

Shots  fired  upon  a  Japanese  naval  vessel  engaged  in 
survey  of  the  Korean  coast  had  in  1875  afforded  excuse  for 
interference,  but  the  opportunity  was  finally  allowed  to 
pass,  although  in  the  following  year  a  treaty  of  friendship 
and  commerce  was  signed.     In  1884  an  attack  by  native 

*K.  Asakawa:   The  Russo-Japanese  Conflict,  p.  27. 


The  Wars  of  the  World:  1878-1914  85 

Koreans  (whose  intense  dislike  for  foreigners  extends  even 
to  other  members  of  the  Mongolian  race)  upon  the  Japa- 
nese legation,  led  to  the  dispatching  of  Japanese  troops 
to  the  kingdom,  an  example  which  China  promptly  fol- 
lowed, with  a  view  to  asserting  her  authority  and  safe- 
guarding her  own  interests.  On  April  18,  1885,  the 
Treaty  of  Tientsin  was  ratified,  by  which  China  was 
brought  to  admit  the  independence  of  Korea  and  to  agree 
to  send  no  more  troops  into  the  country  without  sending 
notification  to  that  effect  to  the  Japanese  Government, 
which  had  already  accomplished  its  main  object  in  the 
recognition  of  Korean  independence. 

In  the  years  intervening  between  this  treaty  and  the 
war,  a  number  of  incidents  occurred  which  served  to  fan 
the  flames.  In  1889  the  action  of  a  Korean  governor  of 
the  province  of  Haingyondo  cut  off  the  export  of  rice  to 
Japan,  which  was  no  longer  capable  of  providing  all  her 
own  foodstuffs  and  had  become  partly  dependent  on  for- 
eign supply.  The  removal  of  this  restriction,  which  had 
been  the  outcome  of  anti-foreign  sentiment,  and  the  pay- 
ment of  a  claim  of  110,000  yen  in  1892  averted  further  dif- 
ficulties at  the  time;  but  in  1894  the  murder  of  Kun 
Okkiun,  a  Korean  political  exile  who  had  found  refuge  in 
Shanghai,  the  conveyance  of  his  body  and  the  murderer 
to  Korea  on  a  Chinese  vessel,  together  with  the  enthusias- 
tic reception  by  the  Koreans  of  the  murderer  and  the  in- 
sults offered  to  the  body  of  his  victim,  stirred  up  feeling 
between  the  two  nations  still  further.  In  the  same  year 
began  the  Tonghak  movement  in  Korea,  riots  by  anti- 
foreign  natives  with  which  the  government  was  unable 
to  cope. 

The  Chinese  Resident  offered  the  help  of  his  government's 
army  to  the  Koreans  and  the  troops  began  to  move  in; 
but,  following  the  provisions  of  the  Treaty  of  Tientsin,  the 


86  The  Economic  Causes  of  Modern  War 

Japanese  Government  was  promptly  advised.  The  Chi- 
nese troops  were  disembarked  June  8,  1894.  By  the 
11th  Japanese  troops  were  also  on  the  way.  China  having 
refused  to  join  in  insisting  upon  internal  reform  in  Korea, 
Japan  on  the  20th  of  July  presented  the  Korean  Govern- 
ment with  an  ultimatum  demanding  numerous  changes. 

Hostilities  with  China  followed  almost  immediately,  pre- 
cipitated by  the  firing  by  Japanese  war  vessels  upon  Chinese 
ships.  There  followed  in  quick  succession  Japanese  vic- 
tories at  Assan,  at  Ping  Yang,  the  naval  victories  of  the 
Yalu,  the  fall  of  Port  Arthur,  and  of  Wei-hai-wei. 

Negotiations  for  peace  began  March  5,  1895,  and  the 
Treaty  of  Shimonoseki  was  ratified  May  8th,  of  the  same 
year.  By  the  terms  of  this  treaty,  Korean  independence x 
was  again  specifically  recognized,  an  indemnity  of  200,000,- 
000  tales  was  to  be  paid  to  the  Japanese,  and  trading  privi- 
leges in  China  were  granted  them.    Most  important  of  all, 

1  The  Official  Account  of  the  Russo-Japanese  War  prepared  by  the  Ger- 
man General  Staff,  sums  up  succinctly  the  Japanese  economic  aims  in  this 
war  and  the  advantages  to  Japan  of  Korean  independence:  "Having 
dropped  her  timid  seclusion  from  the  outer  world,  Japan,  sooner  or  later, 
was  bound  to  assert  her  authority  also  abroad.  The  growing  weight  of 
taxation  arising  from  the  expenditure  for  civil  service,  for  the  army,  and 
for  the  navy,  and  her  rapidly  increasing  population,  forced  Japan  to  find 
new  markets  beyond  the  limits  of  her  island  empire,  and  room  for  the 
employment  of  her  surplus  population.  For  this  purpose  no  country  was 
more  favorably  situated  than  Korea;  ancient  connection  and  tradition 
pointed  to  that  country.  ...  In  the  face  of  Korea's  helplessness  and 
China's  weakness,  it  was  sure  not  to  be  difficult  for  Japan  to  jockey  an 
independent  Korea  according  to  her  own  sweet  will,  and  to  monopolize 
Korean  trade  by  virtue  of  her  advantageous  geographical  position  and  the 
ability  of  her  merchants  and  tradesmen."  English  edition,  pp.  3-4,  Lieu- 
tenant Karl  von  Donat,  translator. 

Thomas  Cowen,  an  English  journalist  long  resident  in  the  East  and 
familiar  with  the  statesmen  of  Japan,  attributed  to  Marquis  Ito  the  fol- 
lowing summary  of  the  conflicting  claims  of  China  and  Japan  in  Korea: 
"The  claims  of  China  over  Korea  were  historical  only — i.e.,  as  the  his- 
tory of  China  reckons  Korea  among  her  tributaries  and  as  China  had  the 
greatest  repugnance  for  changing  the  face  of  history  as  the  worthy  legacy 


The  Wars  of  the  World:  1878-1914  87 

the  Island  of  Formosa,  the  Pescadores,  and  the  Liao-Tung 
Peninsula,  including  Port  Arthur,  were  ceded  to  Japan. 

Nothing  could  show  the  economic  motives  of  the  war 
more  clearly  and  specifically  than  the  terms  of  this  treaty, 
every  one  of  the  important  provisions  of  which  was  of  an 
obviously  economic  character.  Japan  had  now  secured  most 
of  the  objects  on  which  she  had  set  her  heart.  An  indepen- 
dent Korea  could  easily  be  overawed  to  such  an  extent  that 
the  Japanese  could  secure  any  concessions  that  they  might 
desire  as  regards  trading  privileges,  immigration  for  the 
relief  of  the  congested  population,  and  the  supply  of  raw 
materials. 

From  this  time  dates  the  Japanese  monopoly  of  Korean 
trade,  which  grew  rapidly  prior  to  the  Russian  war  and  has 
increased  enormously  since  then.  The  Chinese  merchants, 
who  had  withdrawn  during  the  war,  were  speedily  replaced 
by  enterprising  subjects  of  the  Mikado.  The  Chinese  in 
Korea  were  never  again  one-tenth  so  strong  numerically, 
as  they  had  been  before  the  war,  and  after  its  close  their 
commercial  ventures  were  confined  almost  entirely  to  the 
silk  import  trade  on  the  west  coast.1 

Moreover,  a  first  step  had  been  taken  which  might  ulti- 
mately open  the  way  to  annexation  of  Korea.  The  addition 
of  Formosa  and  the  Pescadores  served  the  territorial  and 
commercial  aggrandizement  of  the  Empire,  and  the  acquisi- 
tion of  Port  Arthur  was  of  the  very  highest  importance  for 

of  ancestral  emperors,  so  she  was  intent  on  claiming  Korea  as  her  vassal 
state.  The  claims  of  Japan  over  Korea  were  economical — i.e.,  she  did  not 
claim  any  regal  authority  over  Korea;  but  from  her  geographical  posi- 
tion and  the  necessity  of  providing  for  her  constantly  increasing  popula- 
tion, she  was  intent  on  utilizing  Korea  as  the  best  source  from  which 
the  defect  in  the  home  product  of  rice  was  to  be  supplied  as  well  as  the 
nearest  field  in  which  the  future  sons  of  Japan  might  find  employment." 
See  Thomas  Cowen:  The  Russo-Japanese  War.  The  italics  are  my  own. 
1K.  Asakawa:   The  Russo-Japanese  Conflict,  p.  15. 


88  The  Economic  Causes  of  Modern  War 

winning  and  holding  economic  and  military  supremacy  in 
the  Far  East.  Its  possession  implied  the  power  of  Japan 
to  checkmate  any  of  the  European  Powers  which  were  con- 
testing for  the  supremacy  in  the  East.  Not  only  did  it 
check  the  expansion  of  Russia,  but  it  gave  the  Japanese 
themselves  abundant  opportunity  for  expansion  into  Man- 
churia, and,  if  the  time  should  ever  come,  for  the  seizure 
of  Korea.  To  hold  Port  Arthur  meant  to  possess  a  base 
for  attack  upon  both  coasts.  Most  important  of  all,  the 
Power  that  held  Port  Arthur  was  in  the  best  possible  posi- 
tion for  winning  the  dominant  influence  in  China,  for 
securing  the  lion's  share  of  Chinese  commerce  and  of  the 
exploitation  of  natural  resources;  and  for  preventing  that 
complete  partition  of  the  Chinese  Empire  among  European 
Powers  which  would  be  fatal  to  Japanese  hegemony  and 
which  Russian  expansion  was  making  more  and  more  prob- 
able within  the  next  decade  or  two. 

Precisely  because  it  was  so  important  to  Japanese  su- 
premacy that  the  flag  of  the  rising  sun  should  float  above 
Port  Arthur,  it  was  equally  important  to  the  European 
Powers  which  were  rivals  for  economic  privileges  and  influ- 
ence in  the  Orient  that  it  should  not  float  there.  If  Japan 
were  once  to  establish  herself  in  this  stronghold,  her  oppor- 
tunities for  mastering  the  trade  of  the  Far  East  surely 
would  be  such  that  her  European  economic  rivals  would  of 
necessity  fall  behind.  Russia,  France,  and  Germany,  there- 
fore, united  in  "advising"  Japan  to  return  it  to  the  Chinese 
and  to  accept  an  increase  in  the  amount  of  the  indemnity 
by  way  of  compensation. 

This  action  on  the  part  of  the  Powers,  whose  economic 
rivalry  with  Nippon  was  supported  by  greatly  superior 
armaments,  coming  at  the  moment  of  triumph  of  a  proud 
nation  which  had  for  the  first  time  proved  its  capacity  for 
using  the  new  methods  of  western  warfare,  precipitated  a 


The  Wars  of  the  World:  1878-1914  89 

storm  of  fury  throughout  the  island  Empire.  In  every 
class  the  nation  had  been  permeated  with  the  ambition  to 
win  hegemony  in  the  East,  and  the  importance  of  retaining 
Port  Arthur  was  as  clear  to  every  one  as  were  the  motives 
of  the  three  European  nations  in  withholding  it. 

The  Japanese  press,  which  even  then  shared  many  of  the 
less  desirable  characteristics  of  the  American  newspaper, 
published  many  bitter  articles.1  Pamphlets  attacking  the 
Powers  and  demanding  retention  of  the  port,  appeared  on 
every  hand.  Only  a  country  thoroughly  under  police  con- 
trol could  have  avoided  being  swept  into  war  by  the  sheer 
weight  of  popular  excitement;  and  as  it  was,  the  newspaper 
censors  worked  overtime.  Newspapers  were  suspended  right 
and  left,  but  new  ones  sprang  up  in  their  places  to  reiterate 
their  patriotic  utterances  until  they,  too,  were  suppressed. 

The  Mikado's  government  had  to  yield  and  knew  it,  for 
Japan  was  not  yet  ready  to  meet  western  nations  in  a  trial 
of  skill  with  western  armaments.  Yield  they  did,  but  from 
that  time  on,  every  Japanese  knew  that  the  struggle  was  to 
be  between  Russia  and  Japan  for  the  trade  and  supremacy 
of  the  Far  East,  since  it  was  Russia  which  was  held  respon- 
sible for  the  joint  action  of  the  three  governments. 

There  followed  an  orgy  of  territory-grabbing  by  European 
nations  which  served  to  show  the  keenness  of  the  economic 
rivalry  that  had  come  to  exist  among  states  which  felt  the 
pressure  of  their  industries  behind  them,  in  their  efforts  to 
find  new  portions  of  the  earth  to  exploit.  More  and  more 
Japan  became  convinced  of  the  dangers  of  her  position  from 
the  military  as  well  as  from  the  economic  point  of  view, 
realizing  that  it  was  only  her  proved  power  which  spared 
her  the  fate  of  helpless  China.  Germany  secured  Tsing- 
Tao,  France  Kuang-chan-wan,  Great  Britain  the  whole  of 

1  A  detailed  account  of  the  popular  excitement  may  be  found  in  Thomas 
Cowen's  The  Russo-Japanese  War,  p.  34. 


90  The  Economic  Causes  of  Modern  War 

the  Kowlung  Peninsula,  north  of  Hongkong,1  and  then 
upon  the  Japanese  evacuation,  Wei-hai-wei.  The  bit- 
terest blow  that  the  pride  of  the  Japanese  in  their  achieve- 
ments ever  received  was  the  subsequent  negotiation  be- 
tween China  and  Russia  giving  to  the  latter  state  not  only- 
trading  rights  in  Manchuria  which  made  her  a  still  more 
serious  economic  rival,  but  also  that  very  coveted  position 
in  Port  Arthur  from  which  the  Japanese  themselves  had 
been  driven  by  Russian  diplomatic  maneuvres  only  a  short 
time  before.  After  that  there  was  no  thought  of  anything 
but  war  with  Russia,  and  a  continuous,  determined  prepa- 
ration for  that  conflict  when  its  day  should  come. 

THE   BOXER  UPRISING,    1899-1900 

The  Boxer  Rebellion  is  commonly  represented  in  the 
West  as  an  outburst  of  fanaticism  due  to  accidental  infringe- 
ment by  Europeans  upon  ancestor  worship  and  similar 
Chinese  "superstitions"  and  to  resentment  of  the  activity 
of  the  missionaries;  so  that  the  Relief  Expedition  which 
marched  to  Pekin  is  thought  merely  to  have  put  down  an 
unjustified  and  brutal  native  rising. 

Not  only  is  this  view  wide  of  the  truth,  but  it  neglects 
entirely  all  the  underlying  and  some  of  the  immediate 
causes  of  the  outburst  initiated  by  the  Chinese  society,  the 
"Fists  of  Righteous  Harmony."  It  does  not  do  justice  to 
the  painfully  real  grievances  of  the  Chinese  and  it  repre- 
sents altogether  too  glowingly  the  altruistic  motives  of  the 
European  Powers,  whose  economic  rivalry  and  greed  in 
seizing  everything   Chinese  upon   which   they   could   lay 

1  Great  Britain  secured  Hongkong  by  treaty  in  1842;  a  foothold  of 
about  five  miles  on  the  Kowlung  Peninsula  in  1860;  and  the  whole 
peninsula  in  1898. 


The  Wars  of  the  World:  1878-1914  91 

hands  had  had  a  great  deal  to  do  with  provoking  the  out- 
break. 

The  extent  to  which  economic  causes  were  operative  as 
well  as  their  importance,  can  be  seen  with  perfect  clear- 
ness by  a  study  of  the  international  situation  in  the  Far 
East  between  the  Treaty  of  Shimonoseki  and  the  begin- 
ning of  the  Boxer  troubles. 

If  there  were  cynics  among  the  statesmen  of  the  Chinese 
Foreign  Office,  they  must  have  realized  at  once  that  the 
compulsion  exercised  upon  Japan  to  secure  the  evacuation 
of  Port  Arthur  was  not  prompted  by  disinterested  concern 
for  the  integrity  of  Chinese  territory.  Scarcely  had  the 
Japanese  departed  when  the  economic  rivalry  of  the  Powers 
of  Europe  began  to  show  itself  and  their  demands  began 
to  be  heard.  First  in  the  field  was  Russia,  suggesting  a  loan 
to  the  Chinese  Government  to  be  applied  to  the  payment 
of  the  Japanese  war  indemnity.  Loans,  when  they  cannot  be 
met  by  disorganized  native  governments,  offer  admirable 
excuses  for  seizing  territory;  and  if  the  governments  do 
prove  able  to  meet  their  obligations,  the  loans  are  still 
beneficial  to  the  financiers  who  arrange  them.  That  was 
why  the  Tsar  generously  offered  to  help  the  Chinese  pay  the 
war  indemnity  imposed  by  Japan.  The  loan  was  one  of 
400,000,000  francs,  at  4  per  cent.,  and  was  sufficient  to  pay 
half  of  the  indemnity.  It  was  arranged  nominally  through 
the  Russo-Chinese  Bank,  which  was  thus  brought  into 
prominence  and  which  soon  extended  through  Siberia  and 
the  Far  East,  maintaining  thirty  branches  and  serving  as  a 
cloak  for  the  commercial  schemes  of  the  Russian  Govern- 
ment. 

In  1897  two  obscure  German  missionaries  were  most 
opportunely  killed  by  the  Chinese.  Germany  promptly 
landed  troops  and  seized  the  bay  of  Kiao-Chau  on  the  coast 
of  the  Yellow  Sea,  the  operations  being  commanded  by  the 


92  The  Economic  Causes  of  Modern  War 

same  Admiral  von  Diedrichs  who  later  encountered  Dewey 
at  Manila.  Just  what  connection  this  had  with  making 
reparation  to  the  families  of  the  dead  missionaries  is  not 
quite  clear;  but  at  any  rate  Germany  had  obtained  a  foot- 
hold which  was  the  beginning  of  her  share  in  the  economic 
struggle  in  the  Far  East  and  of  further  exploitation  of  the 
country.  China  was  browbeaten  into  leasing,  with  full 
rights  of  sovereignty,  the  bay  and  contiguous  territory  to 
Germany  for  a  period  of  ninety-nine  years,  within  which, 
time  many  things  could  (and  did)  happen.  Established  in 
the  principal  port  of  the  province,  Germany  immediately 
began  a  process  of  penetration  by  means  of  railways  and 
mining  concessions. 

In  1898  announcement  was  made  that  the  Russian  fleet 
had  received  "permission"  to  winter  at  Port  Arthur,  then 
in  Chinese  hands,  and  in  the  following  May,  under  threat 
of  hostilities,  China  ceded  Port  Arthur  and  Dalni,  the 
strategically  and  economically  highly  important  tip  of  the 
Liao-Tung  Peninsula.  There  was  an  ominous  silence  from 
the  Japanese  Foreign  Office,  but  a  frenzy  of  indignation 
broke  out  anew  among  the  people  of  Japan. 

In  the  meantime,  Great  Britain  and  France,  far  from 
seeking  to  maintain  the  integrity  of  the  helpless  Chinese 
Empire,  had  themselves  been  seeking  their  share  of  the 
spoils.  Great  Britain,  not  content  with  her  recent  acqui- 
sitions, Kowlung  and  Wei-hai-wei,  now  demanded  a  pledge 
from  China  that  the  Yangtse  Valley  should  never  be  alien- 
ated to  any  other  power,  and  thus  secured  the  dominance  of 
British  commercial  interests  in  that  fertile  region.  Japan 
made  similar  demands  as  regarded  the  widely  separated 
provinces  of  Fukien  and  Amur. 

In  April,  just  before  Russia  had  secured  Port  Arthur, 
France  handed  in  her  demands — nothing  less  than  a  ninety- 
nine  year  lease  of  Kwang  Chau  for  use  as  a  coaling  station, 


The  Wars  of  the  World:  1878-1914  93 

railway  rights  to  Yunnanfui  from  Tonkin,  and  a  promise 
not  to  alienate  to  any  other  power  the  provinces  of  Kwan 
Tung,  Kwangsi,  Yunnan,  or  the  Island  of  Hainan,  and, 
finally,  further  extension  of  French  rights  in  the  vicinity  of 
Shanghai.  The  last  demand  was  of  particular  gravity  in 
its  consequences  because,  with  characteristic  European  in- 
difference to  native  beliefs,  the  lines  proposed  interfered 
with  a  native  cemetery  and  therefore  with  the  peaceful  re- 
pose of  the  ancestors  worshipped  by  the  Chinese  of  Shang- 
hai. This  was  one  of  the  incidents  which  particularly  en- 
raged the  native  populace. 

The  Chinese  Empire  consists  altogether  of  eighteen 
provinces.  Thirteen  of  these  had  now  been  invaded  by  the 
toreigners,  among  them  the  most  populous,  the  most 
wealthy,  and  the  most  desirable — holding  within  their 
borders  the  most  important  waterways,  harbors,  mines, 
and  all  of  the  economic  centres  to  which  foreign  commerce 
could  gain  access. 

In  view  of  all  this  aggression,  which  was  purely  the  out- 
come of  the  economic  rivalry  existing  among  European 
nations,  it  is  at  least  comprehensible  that  the  Chinese  were 
maddened  with  hatred  of  the  foreigner.  The  war  with  Japan 
had  been  brought  on  by  the  Manchu  Government,  and  since 
most  of  it  had  been  fought  in  Manchuria,  a  district  which 
was  peculiarly  their  own,  the  great  mass  of  the  inhabitants 
of  the  Empire  had  regarded  it  with  comparative  indifference 
as  a  concern  of  the  dynasty  rather  than  of  the  Chinese. 
Until  very  recently,  indeed,  patriotism  in  the  sense  in 
which  a  Westerner  thinks  of  it  was  not  known  in  China; 
but  these  demands  of  the  foreign  powers  were  spread 
throughout  the  country  and  affected  every  one. 

Besides  the  irritation  produced  by  foreign  intrusion  in  a 
nation  which  for  years  had  sought  to  keep  to  itself,  there 
were  other  causes  of  dissatisfaction.    The  burden  of  taxa- 


94  The  Economic  Causes  of  Modern  War 

tion  to  meet  what  remained  of  the  indemnity  and  the 
interest  of  the  Russian  loan  with  which  one-half  had  been 
paid,  was  crushing.  The  economic  balance  in  China,  al- 
ways in  a  rather  precarious  state,  was  disturbed  by  two 
years  of  bad  weather  with  consequent  bad  crops,  and  added 
to  the  complexity  of  the  financial  situation.  Thousands 
were  reduced  to  the  verge  of  famine ;  rebellion,  brigandage, 
and  piracy  increased;  and  many  of  the  malcontents  went 
over  to  the  growing  Boxer  Society,  attributing  their  woes 
wholly  or  in  part  to  the  foreigner. 

Even  the  patience  of  the  government  began  to  give  out, 
so  that  when  in  1899  Italy — always  belated  in  the  colonial 
field — put  in  a  claim  for  a  coaling  station  at  Sanmun  on 
the  Chekiang  coast,  together  with  a  railway  and  mining 
grant  in  the  province,  she  met  with  blunt  refusal.  The 
Italian  Government  hesitated  to  use  force,  and  so  desisted, 
the  more  so  as  these  efforts  were  looked  on  with  disapproval 
by  the  Powers  already  secure  in  their  own  possessions. 

When,  shortly  after  his  accession,  the  new  Emperor  began 
to  show  a  tendency  to  adopt  the  methods  and  ways  of  life  of 
the  hated  "foreign  devils" — who  had  shown  themselves 
devilish  enough  in  their  greed  and  unscrupulousness, 
Heaven  knows! — and  actually  issued  a  series  of  edicts 
intended  to  make  sweeping  reforms  throughout  the  state, 
it  was  too  much.  The  Dowager  Empress,  by  a  coup  d'etat, 
put  herself  at  the  head  of  the  government,  by  a  polite 
fiction  exercising  her  sway  through  the  Emperor,  and  gave 
covert  encouragement  to  the  Harmonious  Fists.  In  1899 
the  Society  broke  into  open  violence,  tortured  and  killed 
missionaries  and  converts  in  great  numbers,  and  in  the  sum- 
mer of  1900  laid  siege  to  the  foreign  legations  in  Pekin. 
American  and  Japanese  troops  had  served  to  check  the 
progress  of  the  Boxers  somewhat,  and  the  besieged  lega- 
tions were  finally  relieved  by  an  expedition  composed  of 


The  Wars  of  the  World:  1878-1914  95 

Japanese,  French,  German,  Russian,  American,  and  British 
forces. 

The  rising  having  been  finally  suppressed  and  peace  re- 
stored, the  Powers  imposed  an  indemnity  upon  China,  and 
entered  into  an  agreement  for  the  mutual  maintenance  of 
Chinese  integrity  from  that  time  onward,  and  for  the  pre- 
vention of  further  European  encroachment  upon  her  ter- 
ritory. 

The  whole  rebellion  was  one  more  case  of  protest  by  the 
natives  of  a  weaker  land  against  exploitation  at  the  hands 
of  foreigners.  It  was  territorial  aggression  and  economic 
greed  growing  out  of  European  rivalry  which  lay  at  the 
root  of  the  trouble,  and  the  contributing  difficulties, 
friction  with  missionaries,  ancestor  worship,  and  the  rest, 
were  merely  the  immediate  occasions. 

"Of  all  immediate  causes  of  this  last  upheaval  of  China 
against  the  Occident,"  says  Clements,1  "these  aggressions 
were  the  most  important  factor.  Had  they  never  occurred 
it  is  doubtful  whether  there  would  have  been  a  rebellion." 

European  greed  had  attained  to  such  a  pitch  that  every 
possible  way  of  extorting  profit  from  the  helpless  native 
government  was  employed.  Engrossed  in  their  own  rival- 
ries, the  states  of  Europe  had  paid  scant  heed  to  the  suffer- 
ing and  natural  resentment  of  the  Chinamen.  Commercial 
servitude,  loss  of  sovereignty,  the  forcible  extortion  of 
ninety-nine  year  leases,  foreign  dominance  in  their  finest 
harbors,  the  hypothecation  of  the  likin  and  salt  revenues, 
special  contracts  and  concessions  to  foreign  promoters,  the 
eternal  talk  of  partition,  diplomatic  wrangles  and  demands 
for  "spheres  of  influence,"  indemnities  demanded  on  grounds 
which  no  European  Power  would  have  thought  of  tolerating 
if  applied  to  itself, — these  were  some  of  the  forms  in  which 

1  Paul  H.  Clements :  The  Boxer  Rebellion,  p.  26. 


96  The  Economic  Causes  of  Modern  War 

the  economic  hostility  of  the  Great  Powers  appeared  to 
China.  It  was  this  that  the  Chinese  resented  in  war,  a 
war  which  must  be  laid  at  the  door  of  the  ambition  for 
economic  expansion  of  the  great  nations  of  the  world. 

THE  RUSSO-JAPANESE  WAR,   1904-1905 

The  conflict  between  Russia  and  Japan  is  the  result  of  the 
clash  of  their  economic  interests,  purely  and  simply.  The 
growing  population  and  industry  of  Japan  required  more 
than  the  Korean  territory  for  which  the  Chinese  war  had 
been  fought.  Manchuria  was  needful  also.  But  Russia 
likewise  sought  to  expand  in  Korea  and  Manchuria.  It 
was  necessary  for  her  to  do  so  for  various  economic  reasons 
— to  possess  more  natural  resources,  to  win  a  larger  place 
in  the  markets  of  the  Orient,  and  to  secure  ice-free  ports. 
It  was  necessary  for  Japan  to  expand  in  the  same  direction. 
The  growth  of  her  population  and  her  manufactures,  and 
her  need  for  food  supplies  and  for  markets  made  this  im- 
perative. It  was  because  of  these  things  that  the  Japanese 
dreamed  of  supremacy  in  the  East.  It  was  life  and  death 
to  them  that  they  should  be  supreme. 

Other  incidents  which  fanned  popular  hatred  and  led 
on  to  war  were  the  outgrowths  of  this  fundamental  eco- 
nomic clash.  The  Japanese  desire  to  retain  Port  Arthur 
in  1895  was  not  primarily  military  or  naval;  it  was  rather 
economic — a  way  in  which  to  begin  expansion  in  Manchu- 
ria, a  way  to  Korea,  and  most  of  all,  a  way  to  halt  the 
Russian  rival.  For  exactly  the  same  reasons,  Russia  desired 
the  stronghold.  When  she  could,  she  took  it  from  China 
by  threat  of  war.  When  Japan  in  her  turn  was  strong 
enough,  she,  too,  took  it  from  Russia  by  force  of  arms. 

Japan,  it  is  true,  desired  to  prevent  the  partition  of 
China,  but  this  desire  was  economic  in  its  origin,  certainly 


The  Wars  of  the  World:  1878-1914  97 

not  altruistic.  The  partition  of  China  among  the  Great 
Powers,  towards  which  Russian  policy  was  obviously  tend- 
ing and  which  would  have  favored  Russian  economic  in- 
terests, would  have  ended  the  Japanese  hopes  of  expan- 
sion. What  happened  in  Shantung  when  the  Germans 
secured  Tsing-tao  gave  fair  warning  of  what  might  be 
expected  throughout  China  if  the  powers  once  divided  it 
among  themselves;  and  Russian  expansion  in  Manchuria, 
without  opposition,  made  it  fairly  clear  that  in  the  end 
China  would  be  divided  unless  something  happened  to  put 
an  end  to  the  encroachments  of  the  Slav.  Japan's  object 
was  to  delay  the  partition  until  she  was  herself  strong 
enough  to  prevent  it  by  force. 

The  gradual  development  of  Russian  power  in  Eastern 
Asia  can  be  traced  from  the  Seventeenth  Century,  but 
none  of  the  lands  then  acquired  served  to  satisfy  the  coun- 
try's greatest  economic  need — ports  free  from  ice  the  year 
round.  This  has  always  been  the  principal  difficulty  in 
the  way  of  the  more  complete  development  of  Russian  com- 
mercial possibilities.  The  Baltic  ports,  which  open  com- 
mercial relations  with  the  states  of  Scandinavia  and  central 
Europe,  and  an  outlet  (always  under  the  possibility  of  Ger- 
man control)  to  the  Atlantic,  are  few  in  number  and  are 
ice-bound  part  of  the  year.  Archangel,  to  the  north,  is  six 
months  choked  with  ice,  and  Vladivostok  to  the  east  is 
only  a  little  better.  In  the  south,  Russia  has  ports  on  the 
Black  Sea,  but  all  this  commerce  must  pass  back  and  forth 
under  the  perpetual  menace  of  the  Dardanelles.  The  foreign 
trade  of  southern  Russia  exists  only  by  virtue  of  the  whims 
of  the  Power  that  holds  Constantinople. 

The  logical  step  for  Russia  was  to  secure  possession  of 
the  straits,  which  have  for  centuries  been  in  the  hands  of 
the  gradually  decaying  Ottoman  Empire.  Economic  and 
naval  considerations  made  its  possession  extremely  desirable, 


98  The  Economic  Causes  of  Modern  War 

for  not  only  did  all  the  commerce  of  the  south  of  Russia 
pass  this  way,  where  it  could  be  cut  off  at  any  time,  but  the 
Turkish  rule  closing  the  passage  to  all  warships,  bottled  up 
the  Black  Sea  fleet  and  prevented  the  exertion  of  Russian 
naval  power  in  the  Mediterranean,  except  after  a  very  long 
voyage  from  the  Baltic.  But  British  economic  and  naval 
considerations  stand  in  the  way.  Constantinople,  it  cannot 
be  too  often  repeated,  lies  on  the  trade  route  to  India. 
British  wealth  measured  in  millions  passes  back  and  forth 
within  easy  striking  distance  along  that  route.  It  is  an 
artery  in  which  flows  the  very  life  blood  of  the  British 
Empire.  Great  Britain  will  never  permit  a  strong  Power 
to  establish  herself  there.  The  impotent  Turk?  Well  and 
good.    But  Russia?    Never. 

Through  all  the  centuries  the  great  mass  of  Slavs,  the 
largest  population  in  Europe,  literally  numberless,  inhabit- 
ing a  country  of  rich  natural  resources  with  hundreds  of 
miles  of  the  best  farming  land,  have  remained  closed 
up  within  a  country  which  has  no  ports.  Blocked  to  the 
north,  west,  and  south,  the  trend  of  the  Russian  has  per- 
force been  towards  the  east.  For  the  Slav,  too,  there  has 
been  a  Drang  nach  Osten.  Vladivostok,  the  Mistress  of 
the  East,  was  a  beginning,  but  it  was  not  enough,  for  even 
this  port  is  not  ice-free,  and  Russia  must  touch  warm  water 
somewhere  before  her  economic  future  can  be  assured. 
In  her  Asiatic  as  in  her  European  politics,  this  one  motif  is 
ever-recurrent.  In  one  form  or  another  it  is  continually 
turning  up. 

The  occupation  of  Saghalin,  to  the  exclusion  of  Japan, 
is  but  the  following  out  of  this  policy,  but  it  was  further 
south,  to  the  Yellow  Sea,  that  Russian  ambition  really 
turned.  Along  these  coasts,  in  warm  water,  there  were 
several  ports  through  which  Russian  enterprise  might  build 
up  a  commerce  that  would  make  the  Slav  supreme  in  the 


The  Wars  of  the  World:  1878-1914  99 

Far  East  and  bring  to  his  country  a  boundless  wealth.1 
In  Korea  there  were  Gensan,  Mansampo,  an  ideal  naval 
base,  and  Chemulpo;  and  in  Manchuria,  Port  Arthur, 
Dalni,  and  Tei-lien-wai.  To  secure  one  of  these  only, 
would  be  success;  to  secure  all  of  them  would  be  a  triumph; 
and  towards  these  ends  Russian  policy  was  directed  steadily 
until  the  defeat  which  Japan  had  long  been  planning  put 
an  end  forever  to  Slav  dreams  of  eastern  hegemony. 

Russia  had  secured  Vladivostok  in  1860  and  had  secured 
at  the  same  time  the  cession  from  China  of  a  slip  of  coast 
extending  from  the  province  of  Amur  to  Korea.  In  the 
following  year  an  attempt  to  occupy  the  Straits  of  Tsushima 
was  foiled  by  the  British.  The  southern  part  of  Saghalin 
was  taken  in  1875  and  in  1885  an  effort  was  made  to  secure 
Port  Lazarev  in  Korea,  while  British  attention  was  being 
distracted  by  a  diversion  along  the  Afghan  frontier. 

The  beginning  of  the  Trans-Siberian  Railway  in  1891, 
an  enormous  undertaking,  was  one  of  the  most  important 
steps  in  carrying  forward  the  Russian  trend  to  the  East. 
The  Tsar's  government  now  used  its  influence  at  Pekin, 
enhanced  since  the  interference  with  the  Japanese  at  Port 
Arthur,  to  gain  the  right  to  run  the  railway  across  Chinese 
territory  in  a  straight  line  to  Vladivostok,  instead  of  taking 
the  more  circuitous  northern  route.  Not  only  did  this 
measure  make  the  line  shorter  and  the  cost  of  construction 
less,  but  it  practically  assured  to  the  Russians  the  control 
of  a  strip  of  territory  roughly  800  by  400  miles  in  extent, 
since  the  existence  of  the  railway  without  military  protec- 
tion was  not  to  be  thought  of,  and  since  the  opportunities 

*  General  Kuropatkin,  writing  after  the  war,  said,  "The  question  of 
obtaining  an  outlet  on  the  Pacific  Ocean  was  discussed  in  Russia  some 
time  ago.  It  was  thought  that  an  exit  to  ice-free  seas  would  eventually 
be  a  necessity  in  view  of  the  immense  growth  of  our  population."  The 
Russian  Army  and  the  Japanese  War,  p.  146. 


100  The  Economic  Causes  of  Modern  War 

of  exercising  authority  were  greatly  increased  by  the  com- 
ing of  the  railway.  In  1896  Japan  suggested  the  delimita- 
tion of  Russian  and  Japanese  spheres  of  influence,  Russia 
to  have  Manchuria  and  Japan  Korea;  but  the  Tsar's  gov- 
ernment declined  to  accede.  Two  years  later  Russia 
acquired  Port  Arthur,  under  the  circumstances  already  de- 
scribed, thus  administering  the  bitterest  blow  possible  to 
Japanese  pride. 

The  humiliation  of  the  Japanese  quite  aside,  this  action 
opened  a  new  source  of  friction  in  that  Russia  now  wished 
to  connect  Kwan  Tung  in  which  Port  Arthur  is  situated, 
with  Vladivostok,  600  miles  to  the  north.  Manchuria 
and  Korea,  through  which  the  proposed  line  would  have  to 
pass,  thus  acquired  a  new  interest. 

In  spite  of  the  extensive  immigration  of  Japanese  into 
Korea  that  had  been  going  on  for  some  years,  a  lively  com- 
merce with  Japan,  and  the  presence  in  the  Hermit  Kingdom 
of  Japanese  troops  detailed  to  guard  the  legation  and  tele- 
graph line  from  Fu-san  to  Seoul,  Russian  influence  spread 
more  and  more.  Russian  officers  and  civil  servants  began 
to  find  temporary  employment;  and  in  China  a  large  com- 
mercial organization  was  formed,  with  Russian  officers  at 
the  head,  to  exploit  the  timber  on  the  lower  Yalu. 

During  the  Boxer  disturbances,  Russia  found  a  further 
opportunity  for  extending  her  influence  by  sending  troops 
into  Manchuria  to  protect  the  Trans-Siberian  Railway 
where  it  crossed  Chinese  territory  and  for  the  suppression 
of  revolts  which  might  spread  across  the  frontier.  Alarmed 
by  the  Anglo-Japanese  defensive  alliance  of  1902,  Russia 
concluded  an  agreement  with  France  in  the  same  year,  and 
then  in  order  to  strengthen  her  favor  at  Pekin  and  avoid 
conflict  with  other  European  Powers,  drafted  a  treaty  with 
China  for  the  withdrawal  of  the  troops  in  Manchuria,  at 


The  Wars  oj  the  World:  1878-1914  101 

the  same  time  guarding  sufficiently  against  the  exploitation 
of  the  province  by  other  nations.  The  withdrawal  was  pur- 
posely carried  out  so  slowly  as  to  be  practically  non-effec- 
tive. 

By  the  end  of  the  year  1902  the  strength  of  the  Japanese 
army  and  navy  was  so  increased  that  the  Foreign  Office 
felt  secure  in  adopting  a  bolder  front.  Up  to  this  time  the 
patience  of  the  Japanese  had  been  so  great  as  to  be  ominous, 
had  it  been  interpreted  aright.  Now,  however,  with  a 
strong  army  and  navy  ready  to  strike  instantly,  and  with  a 
treaty  with  Great  Britain  which  would  operate  to  prevent 
a  repetition  of  the  European  intervention  which  followed 
the  Treaty  of  Shimonoseki,  Japan  was  ready  for  the  war 
which  her  statesmen  had  long  recognized  as  inevitable. 

In  July  of  1903  the  Japanese  Foreign  Office  commenced 
negotiations  with  Russia  for  the  regulation  of  affairs  in 
Korea,  where  the  economic  rivalry  of  the  two  Powers  was 
most  obvious,  and  also  in  Manchuria,  demanding  recogni- 
tion of  the  independence  and  inviolability  of  both  China 
and  Korea,  recognition  of  the  preponderating  influence  of 
Japan  in  Korea,  and  Russia  in  Manchuria,  limitations  of 
the  troops  of  both  powers  in  their  respective  territories, 
and  an  open  door  for  Japan  in  Manchuria  and  for  Russia 
in  Korea,  In  order  to  gain  time  while  the  last  section  of 
the  railway  around  Lake  Baikal  was  being  completed, 
Russia  delayed  her  answer.  Japan  stood  firm  while  Russia 
sought  to  evade  the  issue.  Proposals  and  counterproposals 
passed,  while  the  Russian  troops  in  the  East  were  being 
increased  in  number,  and  the  concessionaires  on  the  Yalu 
pushed  their  work.  Realizing  that  her  military  preponder- 
ance was  being  jeopardized  and  that  time  was  precious, 
and  forced,  moreover,  by  the  warlike  spirit  of  the  people, 
Japan  demanded  a  definite  date  for  a  reply  to  her  last 


102  The  Economic  Causes  of  Modern  War 

proposals,  responding  to  further  Russian  efforts  at  tem- 
porizing by  the  recall  of  her  ambassador. 

Without  the  formality  of  a  declaration  of  war,  Japanese 
war  vessels  delivered  an  attack  at  Port  Arthur,  while  simul- 
taneously, General  Kuroki's  army  landed  in  Korea;  and 
for  the  first  time  a  modern  army  of  an  Asiatic  Power  was 
pitted  against  that  of  a  European  Power.  The  Russians 
were  driven  back  on  the  Yalu,  were  besieged  in  Port 
Arthur,  defeated  at  Liao-Yang,  and  again  at  Mukden.  At 
sea  the  Port  Arthur  fleet,  the  Vladivostok  fleet,  and  the 
Baltic  fleet  were  successively  destroyed. 

The  terms  of  peace,  which  were  concluded  at  Portsmouth, 
New  Hampshire,  September  5,  1905,  gave  Japan  the 
territory  necessary  to  her  economic  development,  the  pos- 
session of  Port  Arthur,  and  revenge  for  the  European  inter- 
vention of  two  years  before,  together  with  the  Russian 
lease  of  the  Liao-.Tung  Peninsula,  the  Russian  railways  in 
lower  Manchuria,  and  the  southern  half  of  the  Island  of 
Saghalin. 

With  her  supremacy  in  the  East  assured,  Japan  was 
enabled  to  carry  through  the  economic  program  which  she 
had  mapped  out,  quite  as  ruthlessly  as  any  European  Power. 
Insurrections  in  Korea  led  at  length  to  the  abolition  of  the 
kingdom  in  1910  and  the  establishment  in  its  stead  of  the 
Japanese  Province  of  Chosen.  The  acquisition  of  Shantung 
as  a  result  of  the  Treaty  of  Paris  has  carried  out  almost  to 
the  full  the  economic  development  desired  by  the  states- 
men of  Japan. 

The  series  of  wars  in  the  Far  East  is  plainly  the  out- 
come of  economic  conditions,  and  the  final  conflict  which 
definitely  established  Japanese  hegemony,  is  evidently  due 
to  the  direct  clash  of  two  rival  policies  of  expansions  made 
necessary  by  economic  pressure.  Even  when  we  include 
among  the  motives  of  the  Japanese  the  fear  of  being  swal- 


The  Wars  of  the  World:  1878-1914  103 

lowed  up  and  made  a  colony  in  the  process  of  Russian 
growth,  European  economic  need,  real  or  fancied,  is  still 
the  cause.  The  war  broke  out  because  of  the  existence  of 
two  sets  of  economic  purposes  which  from  their  very  nature 
led  to  conflict. 

If  confirmation  of  the  economic  character  of  these  wars 
were  needed,  it  would  be  found  in  the  events  which  fol- 
lowed. The  war  with  China  had  resulted  in  the  practical 
expulsion  of  Chinese  merchants  from  Korea.  The  second 
war  was  followed  within  five  years  by  formal  annexation, 
which  added  political  domination  to  the  economic  penetra- 
tion that  had  amounted  to  nearly  the  same  thing,  in  the 
years  succeeding  the  victory  of  the  Mikado's  forces.  As 
Chinese  economic  interests  had  been  ended  in  the  provinces 
that  Japan  had  marked  for  herself,  so  were  the  Russian. 

Slowly  at  first,  but  none  the  less  steadily  (and  in  the 
years  succeeding  annexation,  much  more  rapidly)  infiltra- 
tion of  Japanese  settlers  into  the  old  Kingdom  of  Korea, 
which  now  became  the  new  province  of  Chosen,  began  to 
relieve  the  overcrowding  of  the  growing  populace  at  home. 
In  1895,  immediately  after  the  Chinese  War,  there  were 
but  10,463  Japanese  in  Korea.1  Gradually  their  number 
increased,  until  immediately  after  the  war  with  Russia  there 
were  from  40,000  to  50,000.  After  the  war  immigration 
grew  at  the  rate  of  from  20  per  cent,  to  39  per  cent,  annually, 
until  in  1918  there  were  20.6  Japanese  to  every  square  ri 
(5.95501  square  miles,  or  15.42347  square  kilometres)  and 
they  formed  1.87  per  cent,  of  the  total  population.  In 
other  words,  each  square  ri  in  Japan  had  contributed  about 
twelve  persons  to  each  square  ri  in  Korea.2  In  the  city  of 
Seoul  alone,  one-sixth  of  the  population  was  Japanese  and 

1  Statesman's  Yearbook,  1897,  p.  731. 
1  Japan   Yearbook,  1918,  p.  684. 


104  The  Economic  Causes  of  Modern  War 

the  total  number  there  equalled  all  those  in  the  country 
before  the  Russo-Japanese  War.1 

Comparison  of  the  statistics  of  Japanese  immigration  and 
those  of  other  countries  during  the  years  immediately 
before  the  World  War  and  the  first  two  years  after,  leaves 
no  doubt  as  to  what  was  occurring:  2 

Year  Japanese  Other  Nationalities 

1912  243,727  16,589 

1913  271,591  17,439 

1914  291,217  18,025 

1915  303,659  17,100 

The  efficiency  of  the  Japanese  administrators,  merchants, 
and  technical  experts  resulted  in  an  enormous  improvement 
of  the  handling  of  the  natural  resources  of  the  country, 
particularly  after  the  formal  occupation.  The  foreign  trade 
of  the  country  grew  from  59,000,000  yen  in  1910  to  131,000,- 
000  in  1917.3 

A  few  years  before  the  Chinese  War  the  shares  taken  by 
the  various  countries  in  the  import  trade  of  Korea  stood  as 
follows:  Great  Britain  57  per  cent.,  Japan  19  per  cent., 
China  12  per  cent.,  Germany  8  per  cent.,  other  states  4  per 
cent.4  The  defeat  of  China  and  the  growth  of  industry, 
joined  with  the  enterprise  of  the  Japanese,  speedily  changed 
all  that.  At  the  outbreak  of  the  war  with  Russia,  Japan 
had  gained  approximately  a  third  of  the  import  trade 
and  was  receiving  almost  all  of  the  exports.  By  1914, 
290,000    tons   of   iron    ore   were    being   taken    each    year 

1  Statesman's  Yearbook,  1916,  p.  1113.  This  authority  adds:  "There 
has  been  a  large  immigration  of  Japanese  into  the  Peninsula  of  recent 
years  and  a  considerable  exodus  of  Koreans  into  the  neighboring  Russian 
and  Chinese  territory." 

2  Japan  Yearbook,  1918,  p.  684.  These  are  Japanese  figures,  compiled 
by  Professor  Y.  Takenob  of  Waseda  University. 

3  Charles  H.  Sherrill:  Have  We  a  Far  Eastern  Policy?  p.  179. 

4  Statesman's  Yearbook,  1892,  p.  442. 


The  Wars  of  the  World:  1878-1914  105 

from  the  Korean  mines  all  used  by  the  Government 
Steel  Works  at  Wakamatsu,  which  will  eventually  rely  upon 
Korea  for  half  its  raw  material.  The  Korean  production 
of  such  rare  but  important  metals  as  tungsten  and  molyb- 
denum all  go  to  Japan.1  Even  in  1901  and  1902  this  devel- 
opment of  commercial  relations  was  going  on  rapidly,  as  is 
indicated  by  the  following  table :  2 

In  pounds  sterling: 

Total  Korean  Japanese  Total  Korean  Japanese 

Year                     Exports  Share             Imports  Share 

1901     1,080,345  970,663             635,085  247,624 

1902    1,130,429  1,041,395             695,020  280,843 

How  far  Japanese  trade  has  progressed  since  the  annexa- 
tion, the  following  table  demonstrates:  3 

In  yen: 

Total  Korean  Japanese  Total  Korean  Japanese 

Year  Exports                     Share  Imports  Share 

1910  19,913,843  15,378,643  39,782,756  25,348,085 

1911  18,856,955  13,340,551  54,087,682  34,058,434 

1912  20,985,617  15,369,009  67,115,447  40,756,013 

1913  30,878,944  25,022,544  71,580,247  41,214,749 

1914  45,667,340  29,421,949  53,606,448  39,865,572 

1915  49,492,000  40,900,000  59,199,000  41,535,000 

1916  56,801,000  42,964,000  74,456,000  52,459,000 

1917  83,774,000  64,725,000  102,886,000  72,096,000 

1918  154,189,148      137,204,875      158,309,363     117,273,413 

In  trade  and  in  immigration,  in  the  export  of  her  manu- 
factured goods  and  the  import  of  food  and  raw  materials, 
and  in  the  gradually  increasing  outlet  of  her  population, 
Japan's  Korean  policy  demonstrates  the  economic  pressure 
that  forced  the  Empire  on  to  her  successful  wars. 

'Japan   Yearbook,  1918,  pp.  692-693. 

a  British  Diplomatic  and  Consular  Reports,  Annual  Series,  No.  2999,  p.  8. 
Quoted  by  K.  Asakawa:   The  Russo-Japanese  Conflict,  p.  16. 

3  The  statistics,  from  1910  to  1912,  inclusive,  are  from  the  Japan  Gazette, 
p.  329;  from  1913  to  1914,  inclusive,  from  the  Statesman's  Yearbook,  1915, 
pp.  1105-1106;  from  1915  to  1917,  inclusive,  from  the  Japan  Yearbook, 
1918,  p.  689;  and  for  1918  from  the  Statesman's  Yearbook,  1920,  p.  1033. 


106  The  Economic  Causes  of  Modern  War 

THE  BOER  WARS,   1880-1881,  1899-1902 

Analysis  of  the  causes  of  the  Boer  War  of  1899-1902,  and 
of  the  less  important  war  that  preceded  it,  is  difficult  be- 
cause of  the  complexity  and  variety  of  the  factors  involved. 
The  more  ardent  British  patriots  have  denied  any  ambi- 
tions on  the  part  of  their  country,  whether  economic  or 
imperial,  and  have  presented  the  war  as  the  outcome  of 
a  simple  desire  to  secure  justice  and  the  Transvaal  citizen- 
ship and  franchise  for  their  oppressed  fellow-countrymen.1 
If  this  claim  is  to  be  admitted,  we  have  the  remarkable 
spectacle  of  a  great  state  warring  with  a  smaller  state  in 
order  to  enable  its  own  subjects  to  divest  themselves  of  their 
native  citizenship  and  take  up  that  of  the  hostile  state! 

On  the  other  hand,  distinguished  British  economists  have 
asserted  (did,  indeed,  assert  while  the  war  was  still  in 
progress)  that  the  Empire  was  being  made  a  catspaw  for 
a  selfish  group  of  financiers  who  were  promoting  their  own 
financial  interests  at  the  expense  of  the  two  nations.2  The 
fact  that  there  existed  throughout  the  war  a  strong  English 
pro-Boer  party,  which  included  some  of  the  most  eminent 
living  Englishmen,  serves  to  give  color  at  least  to  this  belief, 
and  to  indicate  that  the  causes  of  the  war  were  far  from 
being  idealistic. 

*Sir  Arthur  Conan  Doyle  (The  Great  Boer  War,  p.  26)  says:  "Our 
foreign  critics  with  their  misapprehension  of  the  British  colonial  system 
can  never  realize  that  whether  the  four-colored  flag  of  the  Transvaal  or 
the  Union  Jack  of  a  self-governing  colony  waved  over  the  gold  mines 
would  not  make  the  difference  of  one  shilling  to  the  revenue  of  Great 
Britain." 

2  J.  A.  Hobson  in  a  volume  (The  War  in  South  Africa,  p.  197)  published 
while  the  war  was  still  in  progress,  declared:  "We  are  fighting  in  order  to 
place  a  small  international  oligarchy  of  mine  owners  and  speculators  in 
power  at  Pretoria."  In  a  later  passage  he  returns  to  his  theme:  "This 
war  is  a  terrible  disaster  for  every  one  else  in  England  and  South  Africa, 
but  for  the  mine  owners  it  means  a  large  increase  of  profits  from  a  more 
economical  working  of  the  mines  and  from  speculative  operations." 


The  Wars  of  the  World:  1878-1914  107 

Undoubtedly  the  economic  factor  did  enter  to  a  large 
degree,  and,  as  I  shall  presently  show,  undoubtedly  it  was 
the  underlying,  if  not  the  immediate  cause  of  the  war.  It 
is  equally  true,  of  course,  that  the  British  citizens,  like  all 
the  miners  resident  in  the  Transvaal,  were  suffering  from  a 
discrimination  which  the  most  thoroughgoing  pro-Boer 
could  scarcely  have  regarded  as  either  just  or  fair. 

We  may  outline  four  general  theories  of  the  causation 
of  the  war,  after  which  a  survey  of  the  undisputed  facts 
in  the  case  should  enable  us  to  choose  between  them.  These 
theories  are: 

1.  That  the  Transvaal  was  the  actual  if  not  the  apparent 
aggressor,  and  that  it  was  probably  instigated  by  jealous 
Continental  powers,  especially  Germany,  with  possible 
promises  of  assistance  which  did  not  materialize. 

2.  That  the  British  Government  was  deliberately  used  by 
financiers  and  mine-owners  in  the  Rand,  and  driven  forward 
by  a  popular  rancor  which  was  deliberately  created  by 
interested  persons. 

3.  That  imperialistic  motives  prompted  Great  Britain 
to  round  out  her  South  African  dominions  by  the  forcible 
inclusion  of  the  two  Boer  states,  which  by  geographical  logic 
belonged  with  the  British  colonies  there. 

4.  That  both  governments  handled  a  complex  interna- 
tional situation  clumsily,  misunderstood  and  distrusted 
one  another,  and  so  blundered  into  a  situation  from  which 
neither  could  extricate  itself  without  war. 

It  will  be  observed  at  the  outset  that  the  first  three  of 
these  motives  for  war  are  directly  or  indirectly  economic. 
The  jealousy  of  European  powers,  which  certainly  did  en- 
courage the  Boers,  was  largely  over  colonial  matters,  which 
have  already  been  shown  to  have  their  roots  in  economic 
rivalries.     The  deliberate  use  of  the  government's  war 


108  The  Economic  Causes  of  Modern  War 

power  by  the  financiers  is  patently  and  obviously  economic, 
and  the  theory  that  imperialistic  ambitions  prompted 
Britain  to  the  crushing  of  the  Boer  states  is  equally  eco- 
nomic in  its  ultimate  origin,  since  economics  lies  at  the  base 
of  modern  imperialism.  Only  if  we  are  willing  to  believe 
that  pure  and  simple  blundering  on  the  part  of  both  gov- 
ernments, embittered  by  racial  hatred,  was  the  whole  cause 
of  the  war,  can  we  escape  the  entrance  of  economics,  in  some 
form  or  other,  into  the  Boer  War. 

The  Boers,  or  Afrikanders  as  they  had  come  to  call  them- 
selves, were  the  descendants  of  Dutchmen  who  had  settled 
in  South  Africa  in  the  Eighteenth  Century  and  had  been 
reinforced  by  a  few  Frenchmen,  Huguenots  or  emigres 
driven  out  of  France  by  the  political  and  religious  disturb- 
ances there.  In  1836-39,  in  order  to  escape  the  incoming 
British,  they  had  retired  further  into  the  heart  of  Africa, 
in  what  was  known  as  the  Great  Trek,  and  had  established 
themselves  without  any  formal  state  organization.  In  1877 
their  territories  were  annexed  by  the  British  and  the  change 
in  their  status  was  quietly  accepted.  In  the  latter  part  of 
1880,  however,  enraged  by  the  non-fulfillment  of  promises 
made  them  when  the  British  took  possession,  the  Boers  rose 
and — defeating  at  Majuba  Hill  the  few  troops  that  could 
be  gathered  against  them — threw  off  British  sovereignty 
completely  in  1881. 

It  is  said  that  the  Boers  when  they  took  possession  of 
their  new  lands,  soon  came  to  realize  the  value  of  the  gold 
deposits  there,  but  that  they  concealed  their  knowledge 
from  the  rest  of  the  world,  in  order  that  they  might  con- 
tinue the  peaceful  agricultural  life  to  which  they  were 
accustomed,  and  avoid  the  incursion  of  Uitlanders  which 
was  certain  to  follow  if  the  existence  of  these  very  rich 
deposits  should  become  known. 

Diamonds  had  been  discovered  in  South  Africa  between 


The  Wars  of  the  World:  1878-1914  109 

1867  and  1871,  and  as  early  as  1879  Lord  Wolseley  had 
prophesied  that  extensive  gold  fields  would  eventually 
be  found  in  the  Transvaal.  Five  years  later  the  accuracy 
of  his  judgment  was  proved  by  the  discovery  of  immense 
quantities  of  precious  metal  in  the  mountains  of  the  Trans- 
vaal known  as  the  Rand,  and  during  the  next  two  years 
(1884-86)  as  exploration  and  prospecting  was  carried  fur- 
ther, the  deposits  were  gradually  found  to  be  of  greater 
and  greater  richness. 

Uitlanders — the  term  applied  by  the  Boer  inhabitants 
of  the  Transvaal  and  the  Orange  Free  State  to  all  non- 
Boers — poured  in  from  all  sides.  Most  of  them  were 
British,  but  all  nationalities  were  represented  among  them. 
The  Boers  bitterly  resented  their  presence,  in  spite  of  the 
greatly  increased  wealth  which  the  gold  mines — in  almost 
every  case  worked  by  Uitlanders — brought  to  their  state. 
The  rate  at  which  this  increase  in  revenue  to  the  state 
proceeded  may  be  seen  from  the  following  table,  which 
begins  a  few  years  after  the  gold  craze  and  continues 
almost  to  the  outbreak  of  the  war:  * 

In  pounds  sterling: 

Year                            Revenue  Expenditure 

1889    1,577,445  1,201,135 

1890    1,229,060  1,386,461 

1891    967,191  1,350,073 

1892  1,255.829  1,188,765 

1893  1,702,684  1,302,054 

1894  2,247,728  1,734,728 

1895  3,539,955  2,679,095 

1896  4,807,513  4,671,393 

1897  4,480,217  4,394,066 

This  revenue  was  derived  almost  wholly  from  the  gold 
mines,  a  large  proportion  in  direct  taxes  and  the  rest  in 
indirect;  and  as  the  Uitlanders  owned  almost  all  of  the 

1  J.  A.  Hobson:   The  War  in  South  Africa,  p.  84. 


110  The  Economic  Causes  of  Modern  War 

mines  they  soon  found  themselves  paying  seven-eighths  of 
the  taxes  to  support  a  state  in  which  they  had  no  repre- 
sentation. They  demanded  the  franchise,  which  was  the 
last  concession  in  the  world  that  the  Boers  were  prepared 
to  give,  since  the  great  numbers  of  the  Uitlanders  would 
have  given  them  control  of  the  state  which  the  Boers  felt 
that  they  had  carved  for  themselves  out  of  Africa,  and 
which  they  thought  should  belong  to  them  in  perpetuity. 

The  exasperation  of  the  Uitlanders  at  this  denial  of  what 
they  regarded  as  their  political  rights  was  accentuated  by 
the  fact  that  whilst  Britishers  in  the  two  Dutch  republics 
were  denied  the  franchise,  the  Dutch  residents  of  the  British 
colonies  enjoyed  political  equality;  and  since  the  colonies 
had  been  placed  on  a  self-governing  basis  in  1872,  and  their 
Dutch  population  outnumbered  the  English,  the  Boers  were 
able  to  run  the  government  to  suit  themselves.  The  novel 
situation  was  in  this  way  presented  of  a  Dutch  majority 
ruling  a  British  minority  in  British  territory  and  a  Dutch 
minority  ruling  a  British  majority  in  Dutch  territory! 

British  exasperation  grew  when  later  legislation  made  it 
increasingly  clear  that  the  Boers  had  no  intention  of  ever 
granting  any  share  in  the  government  to  the  newcomers. 
The  requirements  for  naturalization  were  made  more  and 
more  strict,  so  that,  whereas  previously  two  years'  resi- 
dence had  been  sufficient  to  qualify  for  citizenship,  in  1882 
this  was  raised  to  five  and  in  1890  to  fourteen  years. 

In  addition  to  these  fundamental  grievances,  the  Uit- 
landers had  others — an  alleged  corruption  in  the  Boer  Gov- 
ernment, which  certainly  was  very  slack ;  the  fact  that  they 
possessed  no  control  over  the  type  of  education  given  their 
children;  the  denial  of  a  free  press;  the  denial  of  the  right 
of  public  meeting;  disability  from  jury  duty;  and  harassing 
of  the  mining  interests  by  special  legislation  directed  against 
them.    Besides  all  this  there  was  the  perpetual  problem  of 


The  Wars  of  the  World:  1878-1914.  Ill 

native  labor,  which  the  Boer  sanction  of  the  liquor  traffic 
among  the  blacks  made  increasingly  difficult. 

The  Dynamite  Monopoly  offered  another  cause  of  griev- 
ance, more  fancied  than  real,  but  sufficient  to  inflame  the 
indignation  of  the  Uitlanders  against  the  government. 
South  Africa  was  at  this  time  using  one-half  of  the  world's 
supply  of  dynamite.  Obviously  the  control  of  a  trade  of 
such  volume  meant  tremendous  profits  for  the  firm  that 
enjoyed  it.  Such  a  monopoly  had  in  1888  been  granted 
to  one  Lippert,  who  made  it  over  to  a  French  company. 
This  was  cancelled  in  1893  and  what  was  in  form  a  gov- 
ernment monopoly  was  established.  This  gave  most  of 
the  trade  to  the  South  African  Explosives  Company,  which 
was  affiliated  with  Nobel's  Dynamite  Trust,  and  made  a 
profit  of  some  forty  shillings  a  case,  paying  about  five 
shillings  of  this  to  the  government.  The  exact  nature  of 
the  agreements  governing  this  company  have  never  been 
made  clear,  and  the  mystery  that  was  allowed  to  exist 
certainly  justified  the  suspicions  of  corruption  entertained 
by  the  mine  owners,  who  found  themselves  forced  to  pay  a 
high  price  for  the  explosives  without  which  their  gold 
mining  could  not  go  on. 

In  1887  the  right  to  construct  and  operate  all  railways 
in  the  Transvaal  was  awarded  to  the  Netherlands  South 
African  Railway  Company;  and  the  choice  of  the  route 
for  the  new  road  was  left  to  President  Kruger.  Two  ports 
were  available  as  the  seaboard  terminals:  Delagoa  Bay, 
in  Portuguese  territory,  directly  to  the  east,  and  Port 
Elizabeth  in  British  territory  further  to  the  south.  Kruger 
chose  the  first  and  thus  further  alienated  English  sym- 
pathy, since  the  volume  of  the  trade  of  South  Africa  was 
in  this  way  inevitably  diverted  to  the  Portuguese  and  in  a 
large  measure  this  important  trade  route  was  left  at  the 
mercy  of  the  Boers. 


112  The  Economic  Causes  oj  Modern  War 

Besides  winning  the  distrust  of  its  neighbors,  the  Boer 
Government  had  also  incurred  the  hostility  of  the  capitalists 
who  were  at  the  head  of  the  Rand  mines.  The  control  of 
these  companies  had  gradually  been  centred  in  the  hands 
of  a  comparatively  small  group,  some  of  them  Englishmen 
as  in  the  cases  of  Rudd  and  Cecil  Rhodes,  but  a  large 
number,  if  not  a  majority,  Jewish  by  race  and  German  by 
birth.  Wernher,  Beit  &  Co.,  more  commonly  known  as 
the  "Eckstein  Group,"  controlled  twenty-three  mines  and 
three  other  concerns  active  in  other  financial  fields,  domi- 
nating capital  with  an  actual  market  value  of  76,000,000 
pounds.  This  group  also  exercised  a  large  measure  of  con- 
trol in  the  Consolidated  Goldfields  (Beit,  Rudd,  and  Cecil 
Rhodes)  which  controlled  a  group  of  nineteen  mines  and 
had  a  nominal  capital  of  18,120,000  pounds,  and  also  in  S. 
Neumann  &  Co.,  with  a  capital  of  8,806,500  pounds.  The 
same  men  were  more  or  less  concerned  in  other  corpora- 
tions, including  the  Rothschild  Exploration  Company. 
The  exact  ramifications  of  these  groups  are  of  course  not 
to  be  determined  exactly,  but  the  facts  are  known  to  have 
been  about  as  stated,  and  at  any  rate  serve  to  indicate  the 
degree  to  which  the  gold  fields  had  been  brought  into  the 
hands  of  a  comparatively  small  number  of  powerful  finan- 
ciers. There  were  also  the  J.  B.  Robinson  mines,  nine- 
teen in  number,  with  a  total  nominal  capital  of  14,317,500 
pounds.  Last  of  all,  it  must  be  borne  in  mind  that  most  of 
these  men  were  among  the  owners  and  life  governors  of 
DeBeers,  the  diamond  interests. 

International  financiers  practically  owned  the  Transvaal, 
and  although  the  exact  nationalities  of  the  various  share- 
holders have  never  been  determined  with  any  precision, 
it  is  at  least  probable  that  French  and  German  holdings 
exceeded   the   British.     Liquor,   dynamite,   and   gambling 


The  Wars  of  the  World:  1878-1914  113 

interests  were  in  the  hands  of  the  same  groups  of  capitalists 
that  controlled  the  mines. 

Friction  between  the  Boers  who  held  the  political  rights 
and  resented  the  presence  of  foreign  capital,  and  the  capi- 
talists whom  they  taxed,  was  natural  and  to  be  expected ;  but 
it  is  not  so  entirely  true  as  has  been  believed,  that  the 
taxation  was  unjust.  The  mines  were  taking  out  of  the 
Transvaal  100,000,000  pounds  a  year,  and  were  paying 
dividends  of  from  60  per  cent,  to  100  per  cent,  per  annum. 
The  direct  tax  upon  this  was  2.5  per  cent,  of  the  mine 
profits. 

It  was  easy  enough  for  these  powerful  groups  to  secure 
control  of  the  press  and  to  do  a  great  deal  by  means  of  it 
to  stir  up  anti-Boer  sentiment  in  spite  of  the  legal  restric- 
tions which  the  government  exercised.  Cecil  Rhodes,  to- 
gether with  Messrs.  Eckstein  and  Barnato,  had  acquired 
a  leading  interest  in  the  Cape  Argus,  the  evening  paper  at 
Cape  Town,  and  with  this  as  a  nucleus  gradually  built  up 
a  chain  of  newspapers  which  included  the  Johannesburg 
Star,  the  Bulawayo  Chronicle,  the  Rhodesia  Herald,  the 
African  Review,  and  the  Kimberley  Diamond  Fields  Adver- 
tiser. Having  a  group  of  newspapers  whose  circulation 
reached  almost  every  part  of  South  Africa,  this  group  could 
very  easily  reach  public  opinion  in  both  Boer  and  British 
territory  and  stir  up  the  people  as  was  desired.  Hostile  to 
the  Boer  Government,  the  capitalists  were  able  to  secure 
the  publication  of  inflammatory  articles  which  had  much 
to  do  with  the  eventual  outbreak  of  the  war. 

It  is  perhaps  not  possible  to  determine  to  what  degree 
the  British  Government  was  actuated  by  a  desire  to  extend 
the  Empire  further  in  South  Africa,  but  it  is  at  least  sig- 
nificant that  by  the  acquisition  of  the  Transvaal  and  the 
Orange  Free  State  at  the  close  of  the  war,  the  British  pos- 
sessions in  South  Africa  were  properly  rounded  out  into  a 


114  The  Economic  Causes  of  Modern  War 

coherent  bloc  which  included  practically  everything  south 
of  the  Zambesi  River. 

The  situation  which  existed  was  such  that  war  was 
bound  to  come  sooner  or  later.  In  1895  a  group  of  Uit- 
landers  planned  a  rebellion  which  was  to  give  them  control 
of  the  government,  since  the  impossibility  of  political 
adjustments  which  would  give  the  franchise  to  others  than 
the  Boers  was  seen  to  be  quite  impossible.  Dr.  Jameson, 
lieutenant  to  Cecil  Rhodes,  who  was  at  that  time  premier  of 
the  Cape  Colony,  gathered  a  force  of  500  police,  with  three 
field  guns,  on  the  border  of  the  Transvaal,  for  the  assist- 
ance of  the  rebels.  The  rising  of  the  Uitlanders  having 
been  postponed,  Jameson  boldly  led  his  troops  across  the 
frontier,  on  as  mad  a  raid  as  has  ever  been  attempted. 
Within  two  days  he  and  his  men  were  prisoners.  Boer 
resentment  was  bitter;  and,  since  the  raiding  force  was 
made  up  of  the  colonial  police,  Rhodes  was  accused  of 
conniving  at  an  exploit  of  the  preparations  for  which  he 
could  scarcely  have  been  ignorant. 

The  relations  between  the  British  colonies  and  the  Boer 
states  went  from  bad  to  worse.  The  diplomacy  on  both 
sides  was  futile  and  blundering,  so  that  when  in  April, 
1898,  the  Uitlanders  petitioned  the  British  Government  to 
secure  political  rights  for  them,  a  clash  could  hardly  be 
avoided ;  and  when  in  October  the  Boers  sent  an  ultimatum 
demanding  the  withdrawal  of  British  troops  from  the 
border,  hostilities  had  to  follow. 

The  British  were  miserably  unprepared  for  war.  The 
weakness  of  the  forces  then  in  South  Africa  furnish  the 
best  possible  reason  for  believing  that  they  neither  wished 
nor  expected  it,  for  there  were  available  only  two  cavalry 
regiments,  three  field  batteries,  and  six  and  a  half  infantry 
battalions,  about  6,000  men  in  all.  Against  them,  accord- 
ing to  the  figures  of  the  British  Intelligence  Service,  the 


The  Wars  of  the  World:  1878-1914  115 

Boers  could  muster  32,000  men  in  the  Transvaal,  22,000  in 
the  Orange  Free  State,  which  cast  its  lot  in  with  the  sister 
republic,  and  about  100  guns.  Mercenary  troops  and  rebels 
from  the  British  domains,  in  addition  to  these,  brought  the 
total  to  about  100,000  men. 

The  war  opened  with  Boer  triumphs,  and  it  was  not 
until  they  had  been  borne  down  by  sheer  force  of  numbers 
that  the  Transvaal  and  the  Orange  Free  State  submitted. 
In  all,  Britain  was  compelled  to  send  a  total  of  450,000 
men  to  South  Africa.  The  two  republics,  losing  their  inde- 
pendence, became  integral  parts  of  the  British  Empire, 
but  received  in  all  respects  the  most  generous  terms  and 
have  in  the  end,  as  the  events  of  1914  showed,  been  suc- 
cessfully assimilated. 

Re-examination,  bearing  all  these  facts  in  mind,  of  the 
four  theories  of  the  origin  of  the  war  previously  stated, 
serves  to  show  the  dominance  of  the  economic  motive  in 
one  form  or  another.  Without  underestimating  in  any  way 
the  infinite  capacity  of  diplomats  to  blunder,  it  is  impossible 
to  attribute  to  this  alone  the  outbreak  of  the  war.  Even 
diplomats  cannot  do  quite  so  badly  as  that. 

Instigation  from  the  Continent  probably  played  a  com- 
paratively minor  role  in  egging  the  Boers  on  to  war, 
although  the  famous  telegram  from  the  German  Kaiser  to 
President  Kruger  at  the  time  of  the  Jameson  raid  serves 
to  show  that  the  chancellories  of  Europe  were  at  least  not 
blind  to  the  situation  in  South  Africa,  and  the  opportuni- 
ties it  offered  for  embarrassing  Great  Britain,  their  economic 
and  colonial  rival.  Financiers  did  profit  exceedingly  by  the 
war,  and  it  is  idle  to  assume  that  they  were  blind  to  this 
prospect,  or  inactive  in  bringing  it  about.  Nor  is  it  too 
much  to  believe  that  Great  Britain  was  not  wholly  indiffer- 
ent to  the  possibility  of  rounding  out  her  South  African 
dominions. 


116  The  Economic  Causes  of  Modern  War 

Whether  one  accepts  one  or  all  of  these  causes  as  the 
genesis  of  the  war,  the  importance  of  economic  pressure  as 
a  cause  of  war  remains,  for  (setting  aside  the  view  which 
attributes  the  whole  difficulties  brought  about  by  diplo- 
matic blunders)  all  of  the  causes  have  an  economic  root. 
Certainly  the  friction  between  the  Boer  government  and 
the  capitalists  grew  out  of  trade  rivalry,  as  did  the  difficul- 
ties over  the  diversion  of  trade  from  the  British  colonies  to 
the  rival  Portuguese  port,  through  the  construction  of  the 
Netherlands  Railways. 

The  first  war  between  the  British  and  the  Boers  was  an 
evident  case  of  hostilities  following  imperial  expansion. 
The  basal  economic  character  of  such  expansion  has  been 
shown.  The  second  Boer  War  must  also  be  set  down  as 
another  example  of  a  conflict  due  fundamentally  to  eco- 
nomic causes. 


THE    CUBAN    INSURRECTION    AND    SPANISH-AMERICAN    WAR, 

1895-1898 

Nothing  could  have  been  further  from  the  thoughts  of 
the  average  patriotic  American  in  1898  than  economic  con- 
siderations or  trade  rivalry  in  connection  with  the  war  with 
Spain.  It  was  regarded  in  America — with  a  good  deal  of 
justice — as  a  conflict  undertaken  from  altruistic  motives. 
Its  object  was  to  put  an  end  to  intolerable  conditions  exist- 
ing at  our  very  doors,  the  exploitation  of  a  helpless  people 
by  a  brutal  and  wholly  corrupt  and  inefficient  administra- 
tion. 

The  American  troops  who  embarked  for  Cuba  believed 
firmly  that  they  were  going  to  liberate  the  down-trodden 
from  a  cruel  enemy.  To  suggest  that  behind  the  whole 
series  of  events  lay  economic  troubles  and  that  economic 
greed  and  rivalry  were  at  the  root  of  the  war,  would  have 


The  Wars  of  the  World:  1878-1914  117 

appeared  simple  blasphemy;  yet  had  the  economic  causes 
been  inoperative,  the  Cuban  insurrection  would  never  have 
begun,  and  the  consequent  war  between  the  United  States 
and  Spain  would  never  have  been  necessary. 

There  had,  to  be  sure,  been  previous  insurrections  on  the 
island,  but  none  of  proportions  comparable  to  that  which 
broke  out  in  1898,  because  none  had  such  a  weight  of 
misery  as  a  driving  force  behind  them.  It  was  the  altera- 
tions in  the  status  of  the  sugar  market  of  the  world,  the 
benighted  colonial  policy  of  Spain,  and  the  wholly  selfish 
exploitation  of  Cuba  by  Spanish  greed,  together  with  tariff 
discrimination  unfavorable  both  to  the  United  States  and 
to  Cuba,  which  produced  the  poverty,  wretchedness,  and 
dissatisfaction  that  caused  the  insurrection. 

The  island  of  Cuba  is  an  agricultural  land,  almost  wholly 
dependent  upon  its  single  staple  crop,  sugar-cane,  which 
constitutes  four-fifths  of  its  produce.  The  other  fifth  is 
mainly  tobacco.  During  the  period  immediately  preceding 
the  outbreak  of  the  insurrection  of  1895,  partly  as  the 
result  of  a  new  method  of  seed-selection  devised  by  Louis 
Vilmorin,  the  European  production  of  beet  sugar  had  been 
enormously  increased,  with  the  result  that  the  demand  for 
Cuban  sugar-cane  fell  off  with  great  rapidity.  The  amount 
of  sugar  made  from  European  beets  rose  from  200,000  tons 
in  1850  to  3,841,000  tons  in  1894,1  but  the  world's  consump- 
tion had  not  increased  proportionately.    The  Cuban  market 

Albert  G.  Robinson:  Cuba  and  the  Intervention,  p.  31.  Sugar  had  been 
discovered  in  beet  roots  in  1747,  by  Andreas  Sigismund  Marggraf,  of  the 
Berlin  Academy  of  Sciences.  His  pupil,  Franz  Carl  Achard,  established 
the  first  beet-sugar  factory  in  1801  at  Cunern,  near  Breslau,  in  Silesia. 
Napoleon's  policy  increased  prices  and  gave  an  impetus  to  the  industry, 
but  his  fall  nearly  wrecked  it  in  Germany,  the  French  manufacturers' 
more  scientific  methods  enabling  them  to  survive.  In  the  Nineteenth 
Century,  Vilmorin  devised  a  method  of  testing  beets  for  seed,  by  floating 
them  in  a  brine  strong  enough  to  sustain  all  except  those  containing  an 
unusual  quantity  of  sugar. 


118  The  Economic  Causes  of  Modern  War 

was  almost  destroyed.  At  the  same  time,  tobacco  growing 
in  Egypt,  Turkey,  and  other  Asiatic  countries  had  increased, 
and  Europe  was  being  supplied  more  and  more  from  these 
regions  because  of  their  greater  accessibility  and  the  lower 
cost  of  transportation. 

This  left  the  United  States  almost  the  sole  market  for 
Cuba;  but  at  the  same  time  the  American  production  both 
of  beet  and  cane  sugar,  and  also  of  tobacco  was  developing, 
though  not  sufficiently  to  shut  out  the  Cuban  plantations 
entirely  from  their  northern  market. 

The  natural  result  was  a  fall  in  the  price  of  Cuban  sugar, 
and  a  very  heavy  reduction  in  the  profits  of  the  planters, 
together  with  general  unsettling  of  the  economic  condition 
of  the  island,  which  was  productive  of  a  great  deal  of 
misery.  The  situation  demanded  retrenchments,  economies, 
and  the  application  of  scientific  methods  of  production  to 
an  extent  which  the  Cubans  were  not  capable  of  accom- 
plishing. 

The  planters  looked  to  the  Spanish  Government  for  a 
readjustment  of  conditions  which  were  seriously  affecting 
the  prosperity  of  the  island;  but  they  found  small  help 
in  the  venal,  corrupt,  and  clumsy  Spanish  colonial  admin- 
istration. Spain,  in  the  Nineteenth  Century,  was  still  pur- 
suing the  same  policy  that  had  cost  her  an  empire  in  the 
Seventeenth.  Learning  nothing  from  the  colonial  experi- 
ments which  had  built  up  the  British  Empire  in  the  very 
lands  where  her  own  possessions  had  gone  to  ruin,  the 
Spanish  Government  continued  to  regard  colonies  as  exist- 
ing solely  for  the  enrichment  of  the  mother  country,  and 
administered  Cuba  accordingly — blindly,  stupidly,  and  with 
an  incredible  inefficiency. 

Although  the  only  remaining  outlet  for  the  sugar  cane 
grown  in  Cuba  was  the  United  States,  Spain  continued  to 
maintain  a  system  of  tariff  discrimination  which  diverted 


The  Wars  of  the  World:  1878-1914  119 

to  the  manufacturers  of  Catalonia  the  Yankee  millions 
paid  into  the  hands  of  the  Cubans  for  sugar  cane.  Coal, 
iron,  manufactured  goods,  the  island  imported  from  abroad. 
The  United  States,  almost  within  sight  of  the  Cuban  coast, 
possessed  all  these,  and  as  Cuba's  principal  customer,  might 
well  have  expected  the  major  portion  of  Cuban  trade  in 
return. 

To  prevent  this  very  exchange  from  taking  place,  Spain 
had  so  adjusted  her  tariff  system  that  everything  which  the 
Cubans  bought  must  come  from  Spanish  merchants.  In 
many  cases  the  only  way  in  which  American  goods  could 
be  sent  into  Cuba  was  by  shipment  to  Spain  and  then  by 
re-shipment  back  across  the  Atlantic.  The  Spanish  mer- 
chants, assured  by  their  paternalistic  government  of  a 
monopoly  of  the  Cuban  market,  took  advantage  of  their 
favorable  situation  to  charge  exorbitant  prices.  The  result 
in  Cuba  was  the  reduction  of  industry,  with  consequent 
poverty,  misery,  idleness,  and  general  unrest. 

Bad  as  the  economic  situation  was,  other  causes  for  dis- 
content among  the  islanders  existed.  The  government  was 
inefficient  and  corrupt.  The  Spanish  governor  of  the  little 
island  received  more  in  pay  and  allowances  than  the  Presi- 
dent of  the  United  States.  The  government  posts  were  in 
the  main  held  by  Spaniards,  especially  the  more  lucrative; 
and  Cubans  who  were  able  to  find  a  way  into  the  govern- 
ment usually  despaired  of  improvement  and  followed  the 
example  in  corruption  set  them  by  their  Spanish  masters. 
Managed  as  it  was,  from  above,  and  managed  not  for  the 
benefit  of  its  people,  but  for  the  profit  of  Spain,  the  colony's 
taxation  system  speedily  developed  into  another  fruitful 
source  of  discontent.  The  taxes  were  heavy,  and  the  Cubans 
regarded  them  as  unjust. 

In  1868-1878  the  vaguely  felt  discontent  which  had 
always  smouldered  in  the  island  burst  out  in  a  rebellion 


120  The  Economic  Causes  of  Modern  War 

that  dragged  along  for  ten  years,  but  was  confined  alto- 
gether to  the  eastern  provinces.  There  had  been  previous 
revolts,  but  the  memory  of  this  one  remained  vivid.  Then 
came  the  economic  crisis  and  the  suffering  which  attended 
it.  Spain  did  nothing  to  remedy,  through  political  adjust- 
ment, the  economic  evils  that  dragged  on  year  after  year. 
Prior  to  1894  the  United  States  tariff  still  allowed  a  degree 
of  reciprocity  to  Cuba,  in  spite  of  the  discrimination  against 
America  in  the  tariffs  of  Spain;  but  on  August  27,  1894, 
the  passage  of  the  Wilson  Bill x  put  an  end  to  this  conces- 
sion and  made  the  economic  condition  of  the  Cubans  still 
more  precarious.  The  situation  had  been  bad  enough  when 
the  Spanish  tariffs  made  Cuba  a  dumping  ground  for 
Spain;  it  became  intolerable  when  a  second  tariff  system 
still  further  affected  the  sugar.  Planters  began  to  decrease 
their  acreage,  and  the  laborers  thus  thrown  out  of  employ- 
ment, formed  a  group  of  malcontents  who  were  fertile 
breeding  ground  for  insurgent  propaganda. 

The  inefficiency  and  amazing  folly  of  the  Spanish  admin- 
istration becomes  apparent  when  it  is  considered  that  the 
revolution  which  in  the  end  deprived  Spain  of  one  of  the 
most  fertile  islands  in  the  world,  grew  fundamentally  out 

1 A  contemporary  account  by  the  former  American  minister  to  Spain 
attributes  the  revolution  entirely  to  this  bill:  "There  can  be  no  doubt 
that  the  economic  crisis  that  followed  that  event  (i.e.,  the  passage  of  the 
bill)  precipitated  the  present  revolution.  When  exposed  without  miti- 
gation to  two  systems  of  hostile  tariffs,  at  a  time  when  the  price  of  cane 
sugar  had  been  reduced  by  competition  to  a  very  low  point,  the  Cuban 
producers  threw  up  their  hands  in  despair,  and  the  bands  of  laborers 
thus  deprived  of  work  were  the  first  to  swell  the  ranks  of  the  insur- 
gents. .  .  .  When,  therefore,  we  arrive  at  the  final  cause  that  drove  the 
Cubans  into  the  present  revolution,  we  discover  that  the  rising  really  grew 
out  of  a  struggle  for  bread — a  struggle  for  bread  in  one  of  the  most 
favored  spots  in  the  world,  produced  in  the  main  by  economic  laws  wedded 
to  the  obsolete  doctrine  that  the  commerce  of  a  colony  is  a  possession 
which  the  parent  state  has  a  right  to  manipulate  in  its  own  interest  re- 
gardless of  the  fate  of  the  colony  itself." — Hannis  Taylor:  "Review  of 
the  Cuban  Question,"  North  American  Review,  165:616-617,  N.,  '97. 


The  Wars  of  the  World:  1878-1914  121 

of  a  struggle  for  food  in  a  land  which  might  have  been  one 
of  the  most  productive  in  the  world.  Selfishness,  greed, 
stupidity,  expressed  in  a  blind  neglect  of  the  economic  situa- 
tion in  the  fertile  island — these  caused  the  Cuban  insurrec- 
tion and  the  American  intervention  which  had  to  follow.1 

When  the  army  of  Gomez  began  hostilities  in  1895  it  did 
not  have  the  support  of  the  entire  Cuban  population.  Only 
gradually  did  it  come  to  win  the  backing  of  all  classes,  or 
of  most,  at  any  rate;  and  it  was  not  until  two  years  later 
that  complete  independence  from  Spain  was  made  the 
avowed  object  of  the  insurrection,  which  thus  became  a 
revolution.  Autonomy  was  proclaimed  by  the  rebels  in 
November,  1897. 

The  Cuban  native  army,  although  greatly  inferior  in 
numbers  and  equipment  to  the  Spanish  regulars  operating 
against  it,  had  very  much  the  better  of  it,  owing  to  the  fact 
that  it  was  operating  in  friendly  territory,  could  obtain 
supplies  more  easily,  and  was  much  more  mobile  owing  to 
its  superior  ability  to  move  through  the  jungles.  In  order 
to  deprive  the  rebels  of  these  advantages  as  far  as  possible, 
Weyler,  the  Spanish  Captain-General,  adopted  a  policy  of 
concentration,  stripping  the  country  of  every  inhabitant, 

1  The  views  expressed  on  this  point  and  the  analysis  of  the  causes  of 
the  war  by  Albert  G.  Robinson  are  interesting.  He  says:  "It  is  an  im- 
portant fact,  though  generally  overlooked,  that  repressive  economic  laws 
have  been  in  every  case  the  provoking  cause  of  Cuban  revolt.  Unlike 
those  of  her  neighbors  in  Latin  America,  Cuba's  insurrections  have  never 
been  the  outcome  of  purely  political  conditions.  Nor  have  they  ever 
been  the  result  of  individual  ambition.  Spain's  colonial  policy  was,  in 
every  instance,  the  cause  of  Cuban  revolt.  In  that  policy,  she  violated 
a  fundamental  principle  of  government.  She  assumed  that  the  subject 
existed  solely  for  the  benefit  of  the  sovereign.  In  establishing  her  col- 
ony she  sought  only  her  own  financial  advantage.  Other  colonizing  coun- 
tries learned,  through  experience,  the  folly  of  such  a  policy.  Spain  never 
learned  it,  and  has  now  lost  her  insular  possessions." — Albert  G.  Robinson: 
Cuba  and  the  Intervention,  p.  2. 


122  The  Economic  Causes  oj  Modern  War 

and  moving  men,  women,  and  children  forcibly  into  con- 
centration camps  where  they  suffered  extreme  privations. 

It  must  be  remembered  that  the  Insurrectos,  too,  had 
adopted  a  policy  very  much  the  same,  and  that  they  had 
put  into  effect  in  1895  a  policy  of  economic  warfare  which 
involved  a  deliberate  devastation  of  their  own  country 
in  order  to  hamper  the  Spaniards. 

There  can  be  no  question  that  the  American  intervention 
was  prompted  in  the  main  by  humanitarian  motives.  The 
brutality  of  Spanish  administration  had  inflamed  public 
opinion  in  the  United  States,  which  was  carefully  played 
upon  by  Cuban  juntos  and  by  the  sensational  press.  The 
island  of  Cuba  swarmed  with  American  special  corre- 
spondents, all  engaged  in  sending  back  to  their  newspapers 
the  most  emotional  stories  possible. 

It  was  this  primarily  that  brought  about  American  inter- 
vention in  1898;  and  this  was  the  only  cause  for  war  of 
which  the  public  was  aware.  But  this  was  not  actually  the 
sole  American  motive.  For  at  least  a  hundred  years  it 
had  been  realized  by  various  American  statesmen  that 
Cuba  belonged  economically  to  the  United  States,  and 
proposals  for  acquiring  possession  of  it  had  been  made 
from  time  to  time. 

In  President  McKinley's  famous  message  to  Congress 
dealing  with  the  subject  of  intervention,  in  April,  1898,  the 
economic  motive  appears  explicitly  in  the  third  of  his 
reasons  for  interference: 

"Third,  the  right  to  intervene  may  be  justified  by  the  very 
serious  injury  to  the  commerce,  trade,  and  business  of  our  peo- 
ple, and  by  the  wanton  destruction  of  property  and  devastation 
of  the  island." 

The  "serious  injury"  amounted  to   the  practical  wiping 
out  of  American  trade  in  Cuba,  which  at  the  beginning 


The  Wars  of  the  World:  1878-1914  123 

of  the  rebellion  had  been  nearly  $100,000,000  annually.1 
Even  in  the  absence  of  a  direct  economic  motive  affecting 
the  interests  of  the  United  States  themselves,  the  interven- 
tion in  Cuba  may  properly  be  regarded  as  due  to  economic 
causes,  simply  because  it  was  a  result  of  the  insurrection; 
and  since  this  revolt  grew  directly  from  economic  causes, 
the  intervention  may  certainly  be  said  to  have  grown  indi- 
rectly from  them.2  The  entire  conflict  was  due  to  Spanish 
exploitation  of  a  fertile  colony.  If  economic  justice  had 
prevailed  in  Cuba  there  would  have  been  no  insurrection, 
certainly  not  a  revolt  sufficiently  widespread  to  give  rise 
to  the  reign  of  brutality  in  its  suppression  which  brought 
the  United  States  into  the  war. 

The  Cuban  Revolution  and  the  Spanish-American  War 
were  both  the  outcome  of  economic  rivalry,  with  three  main 
phases:  first,  between  the  European  and  Cuban  sugar 
industries;  second,  between  the  economic  interests  of  the 
colony  and  those  of  the  mother  country ;  and  third,  between 
American  and  Spanish  manufacturers,  with  advantage  on 
the  side  of  the  latter,  through  tariff  discrimination. 

THE   GRECO-TURKISH    WAR,    1897 

The  war  between  Greece  and  Turkey  in  1897,  which 
ended  in  Greek  defeat  after  only  thirty  days  of  campaign- 
ing, was  too  trifling  an  affair  to  deserve  much  attention. 
Yet  it  is  of  interest  because  it  shows  how,  even  in  wars 
waged  for  racial  or  political  reasons,  economic  conditions 
still  contrive  in  some  measure  to  find  entrance. 

*  Hannis  Taylor :  "A  Review  of  the  Cuban  Question  in  its  Economic, 
Political,  and  Diplomatic  Aspects,"  North  American  Review,  165:611, 
N.,  '97. 

3  "The  Cuban  Insurrection  against  Spain,  and  thus  indirectly  the  Span- 
ish-American War,  was  the  outcome  of  the  sugar  situation."  E.  R.  A. 
Seligman:   The  Economic  Interpretation  oj  History,  p.  86. 


124  The  Economic  Causes  of  Modern  War 

In  the  conflicting  interests  and  the  jealousies  of  the  great 
Powers  involved  in  this  war,  moreover,  the  old  element  of 
European  international  discord,  which  we  have  seen  springs 
in  large  measure  from  economic  causes,  again  comes  into 
play.  England  loses  ground  with  the  Ottoman  Empire, 
whose  favor  is  all-important  to  keep  Russia  out  of  Con- 
stantinople and  away  from  the  route  to  the  rich  lands  of 
India.  Germany  seeks  to  curry  favor  with  the  Porte  in 
order  to  facilitate  the  Drang  nach  Osten  and  the  relief  of 
German  over-population,  the  excess  of  manufactures,  and 
the  need  for  markets  and  raw  materials.  Russia,  ever  with 
an  eye  to  Constantinople  and  the  necessity  of  securing  her 
southern  trade  routes,  vies  with  Germany  in  seeking  to 
establish  herself  in  the  good  graces  of  the  Sultan.  All  of 
this  diplomacy  has  an  origin  in  the  economic  difficulties  of 
the  great  Powers. 

Yet  the  motives  which  led  the  venal  Greek  statesmen 
into  war  upon  the  Turk  were  not  primarily  economic.  The 
difficulties  arose  over  the  ever-perplexing  Cretan  question, 
and  were  not  wholly  concerned  even  with  territorial 
aggrandizement  by  possession  of  the  island.  The  motives 
were  very  largely  religious  and  racial,  for  the  Cretans  were 
brothers  in  blood  of  the  Greeks  and  in  the  main  the  popu- 
lation of  the  island  professed  the  Christian  faith ;  but  they 
were  under  the  rule  of  the  Sultan,  who  evaded  whenever 
possible  his  agreement  to  assign  a  Christian  Vali  to  govern 
them. 

Turkish  rule  in  Crete  was  no  better  than  Turkish  rule  has 
ever  been  anywhere.  The  Cretans  were  oppressed;  they 
thought  themselves  over-taxed ;  and  the  government  of  the 
island  was  corrupt.  There  had  been  numerous  revolts,  of 
which  the  most  recent  and  the  most  vigorous  had  been 
suppressed  successfully  by  the  Ottoman  government.   Dur- 


The  Wars  of  the  World:  1878-1914  125 

ing  the  year  between  this  revolt  and  the  beginnings  of  the 
difficulties  between  Greece  and  Turkey,  there  had  been 
several  massacres  of  Christians,  which  roused  a  powerful 
pro-Cretan  sentiment  in  Greece,  although  it  must  be  ad- 
mitted that  when  the  opportunity  came,  the  Christians  in 
Crete  showed  themselves  quite  as  ready  to  massacre  Mos- 
lems as  ever  Moslems  had  been  to  massacre  them. 

In  1896  a  Greek  patriotic  society,  the  Ethnike  Hetaira, 
which  had  for  one  of  its  objects  the  relief  of  Crete,  began 
to  increase  in  power.  It  was  not  in  essence  different  from 
the  Serbian  patriotic  society  which  Austria  alleged  in  1914 
had  been  instrumental  in  the  murder  of  the  Archduke 
Ferdinand.  The  existence  of  such  societies  is  inevitable 
wherever  a  coherent  racial  unit  is  forcibly  amalgamated 
with  an  alien  civilization  and  government,  although  in  this 
case  it  springs  up  in  independent  Greece  rather  than  in 
the  oppressed  land  of  Crete  itself.  As  in  Serbia,  so  in 
Greece,  the  army  was  largely  represented  in  the  member- 
ship— to  such  an  extent  that  three-quarters  of  the  com- 
missioned personnel  is  said  to  have  belonged.  This  society 
had  a  great  deal  to  do  with  rousing  the  sentiment  of  the 
Greek  nation,  and  when  in  1897  there  were  more  massacres, 
war  was  the  most  natural  consequence. 

The  armies  of  the  two  powers  massed  on  the  Thessalian 
frontier  and  the  incidents  that  are  the  usual  accompani- 
ments of  simultaneous  mobilizations  took  place.  Firing 
across  the  frontier  did  not  serve  to  allay  popular  excite- 
ment. 

February  11,  1897,  the  Greek  navy,  under  the  command 
of  the  Crown  Prince,  was  sent  to  oppose  the  landing  of 
Turkish  relief  on  the  island,  with  orders  to  use  force  if 
necessary.  Two  days  later,  Greek  troops  under  the  com- 
mand of  Colonel  Vassos,  moving  to  occupy  the  island,  began 


126  The  Economic  Causes  of  Modern  War 

hostilities.  The  Greeks,  after  a  few  preliminary  successes, 
were  hopelessly  defeated.  Turkey  won  back  again  portions 
of  Thessaly  which  had  been  ceded  to  Greece  in  1881,  and 
the  defeated  nation  was  compelled  to  give  up  for  a  time  its 
hope  of  annexing  Crete. 

Although  the  ostensible  and  actual  primary  causes  of 
the  war  were  racial  and  religious,  as  well  as  humanitarian, 
it  cannot  be  said  that  they  were  the  only  ones.  Crete  be- 
longed to  Greece,  not  only  racially,  but  also  geographically 
and  economically.  It  is  a  very  rich  island,  and  the  Turkish 
maladministration  had  not  been  so  bad  but  that  the  land 
retained  its  wealth.  It  would  have  made  a  highly  desirable 
economic  addition  to  Greek  territory,  for  Greece  is  not 
blessed  with  much  fertile  land. 

The  Hon.  E.  A.  Bartlett  summed  up  the  economic  situa- 
tion in  a  paragraph :  "Crete  is  a  rich  island  which  has  been 
very  lightly  taxed  under  the  much  abused  Turk.  The 
Greeks  desired  to  annex  Crete,  which  they  regard  as  a 
milch  cow  to  be  milked  and  bled  for  the  benefit  of  Greece."  l 

THE  HERERO  RISING,  1903-1908 

After  the  original  annexation  in  1885,  German  occupation 
of  Southwest  Africa  had  been  disturbed  only  by  an  insignifi- 
cant Hottentot  revolt,  suppressed  in  1894,  and  a  few  local 
risings.  This  quiet  possession  of  a  colony  whose  commer- 
cial value  was  slowly  developing,  was  broken  in  October, 
1903,  by  an  insurrection  among  the  Bondelzwart  natives, 
in  the  extreme  south  of  the  German  dominions.  Colonel 
Theodor  Leutwein,  the  German  governor,  in  his  effort  to 
crush  the  rebellion  as  speedily  as  possible,  practically 
stripped  Damaraland,  in  the  north,  of  troops,  giving  oppor- 

JE.  A.  Bartlett:   The  Battlefields  of  Thessaly,  p.  17. 


The  Wars  of  the  World:  1878-1914  127 

tunity  to  the  Herero  natives  for  a  revolt  which  had  long 
been  planned  and  prepared. 

Its  motive  was  chiefly  impatience  with  German  rule,  the 
inevitable  clash  between  the  colonizing  white  man,  driven 
out  of  Europe  by  economic  necessity,  and  the  native  whom 
he  seeks  to  displace.  This  elementary  cause  for  rebellion 
had  been  aggravated  by  abuses  by  the  white  traders,  bru- 
tality of  some  of  the  officials,  and  encroachments  on  tribal 
lands. 

By  New  Year's  Day,  1904,  Colonel  Leutwein  had  sup- 
pressed the  rising  among  the  Bondelzwarts,  but  on  the 
12th  day  of  January,  the  Hereros  attacked  the  settlers  in 
their  country,  murdering  the  families  and  devastating  the 
farms.  To  deal  with  them,  reinforcements  had  to  be  sent 
from  Germany.  The  German  army,  lacking  the  long  expe- 
rience of  colonial  warfare  possessed  by  the  British,  and  for 
centuries  trained  in  the  tradition  of  European  warfare  only, 
did  not  adapt  itself  well  to  the  guerilla  tactics  of  the 
Hereros.  In  spite  of  a  defeat  in  one  pitched  battle,  the 
natives  were  able  to  terrorize  the  countryside  until  in 
October,  1904,  a  rising  of  Hottentots  occurred  to  encourage 
them  further.  The  German  policy  of  Schrecklichkeit  now 
adopted,  provoked  a  third  revolt,  this  time  among  Hotten- 
tot tribes  hitherto  quiet.  The  war  dragged  on  until  1907, 
when  German  success  led  to  a  reduction  of  forces  in  the 
colonies;  and  hostilities  were  finally  concluded  in  1908. 

Since  it  was  a  result  of  German  colonial  policy  made 
necessary  by  the  economic  requirements  of  the  new  Empire, 
the  Herero  rising,  like  other  conflicts  between  colonizing 
powers  and  natives  reluctant  to  be  dispossessed,  is  to  be 
classed  among  the  wars  whose  cause  is  fundamentally 
economic.  In  no  essential  respect  does  it  differ  from  other 
wars  of  colonization. 


128  The  Economic  Causes  oj  Modern  War 

ITALO-TURKISH   WAR,    1911 

Italy's  war  with  Turkey  to  secure  Tripoli  was  wholly  the 
outcome  of  economic  causes,  principally  the  desire  of  the 
Italians  to  have  a  share  in  the  undeveloped  lands  of  the 
globe,  in  which  their  commercial  rivals  were  rapidly  out- 
stripping them. 

Nowhere  can  there  be  found  a  more  perfect  example  of 
the  way  in  which  over-population  produces  emigration  and 
compels  a  state  either  to  seek  an  enlargement  of  its  domains, 
or  else  to  watch  its  citizens  drift  away  and  be  absorbed 
into  the  civilization  of  other  lands.  In  addition  to  the  need 
for  a  colony  where  the  surplus  of  Italian  population  might 
settle,  a  second  economic  motive  for  war  existed  in  the 
Tripolitan  mineral  deposits  and  the  possibility  of  extensive 
agricultural  development  under  scientific  management 
which  the  Italians  felt  themselves  capable  of  introducing. 
At  the  bottom  of  the  whole  affair,  besides  the  other  eco- 
nomic interests,  lay  the  pressure  of  the  population  of  Italy. 

Italy's  imperial  ambitions  were  so  late  in  developing 
that  when  her  statesmen  sought  room  in  the  globe  where 
their  country  and  its  trade  might  expand,  they  found  most 
of  the  available  territory  already  occupied  by  states  too 
powerful  to  be  dispossessed.  The  failure  in  Abyssinia  is 
an  obvious  example,  as  is  Italian  inability  to  secure  a  share 
when  the  Powers  were  engaged  in  the  scramble  for  Chinese 
territory.  As  the  Italian  nation  came  to  unity  in  the  years 
following  the  Risorgimento  of  1860-1861,  imperial  ambi- 
tions arose,  not  merely  because  there  was  a  feeling  that  the 
dignity  of  the  united  nation  demanded  possessions  over- 
seas, comparable  to  those  of  other  Powers  of  Europe, 
but  because  an  economic  need  for  expansion  in  competition 
with  the  other  Powers  began  to  make  itself  felt. 

No  other  nation,  not  even  Germany,  has  faced  an  emi- 


The  Wars  of  the  World:  1878-1914  129 

gration  problem  so  serious  as  that  in  Italy,  nor  has  any 
people  shown  itself  more  adaptable  in  settling  in  foreign 
lands.  By  means  of  an  uncanny  "wireless"  the  working 
classes  in  Italy,  from  which  the  emigrants  mainly  come, 
seem  to  know  to  a  nicety  the  exact  conditions  of  the  labor 
market  of  the  world,  and  precisely  the  right  time  to  emi- 
grate. 

The  tide  of  emigration  has  turned  chiefly  to  the  United 
States,  but  great  numbers  have  gone  to  the  Argentine 
Republic  and  to  the  French  colony  in  Tunis — by  the  logic 
of  geography  an  Italian  dominion,  into  which,  to  the  fury 
of  Italian  imperialists,  France,  with  Bismarck's  secret  con- 
nivance, forced  her  way. 

The  loss  of  Italian  citizens  going  to  other  countries 
rose  between  1878  and  1900  from  96,000  to  352,782  and  in 
1906  reached  its  maximum  of  787,977.  In  the  following 
year  it  declined  only  a  little,  to  704,675;  and  in  1909  it 
declined  still  further  to  625,637.  Since  then  the  emigration 
each  year  has  hovered  between  500,000  and  600,000/  These 
rates  of  emigration  present  a  rough  parallel  to  the  rising 
excess  of  births  over  deaths  during  the  years  between  1880- 
1910.2 

For  the  purposes  of  Italy,  Tripoli  was  the  only  space 
left  on  the  coasts  of  the  Mediterranean,  and  to  its  acquisi- 
tion Italian  statesmanship  accordingly  turned  itself. 

Only  a  few  weeks  before  the  outbreak  of  hostilities,  an 
editorial  comment  in  the  Rassegna  Nazionale  (Florence) 
summed  up  the  Italian  attitude  toward  the  war  in  two 
succinct  paragraphs: 

"If  tomorrow  France  should  rule  over  the  entire  northern 
coast  of  Africa,  not  only  would  this  cause  added  dangers  for  us 

'Algar  Thorold:  "The  Expansion  of  Italy,"  Edinburgh  Review,  220:67: 
Jy.,  '14. 

2  See  table  on  p.  17. 


130  The  Economic  Causes  of  Modern  War 

in  case  of  hostilities — which  it  is  to  be  hoped  may  never  take 
place — when  France  could  attack  us  from  the  French  and  Afri- 
can coasts  and  from  Corsica,  but  also  in  time  of  peace  we  should 
be  seriously  annoyed  by  our  relegation  to  secondary  rank  as  a 
Mediterranean  power,  and  loss  of  prestige.  As  well,  we  should 
be  bound  in  an  iron  girdle  that  would  render  any  industrial  and 
economic  expansion  of  almost  treble  difficulty. 

"Every  publicist  recognizes  the  necessity  of  re-establishing  the 
balance  of  power  by  means  of  an  action  on  our  part  in  Tripoli- 
tania,  but  some  maintain  that  this  action  should  be  limited  to 
an  economic  penetration  without  embroiling  our  relations  with 
Turkey  and  without  embarking  on  any  colonial  adventure.  But 
is  this  possible?" 

Of  course  it  was  not  possible.  The  Ottoman  Empire  had 
Tripoli  and  intended  to  hold  it.  But  the  Ottoman  Empire 
was  weak  and  disorganized,  still  confused  as  a  result  of  the 
revolt  of  the  Young  Turks  three  years  before.  Italy  had 
the  force  to  take  what  she  wanted  from  a  weaker  nation 
and  did  so, — following  the  very  practical  principles  of  inter- 
national ethics. 

There  is  one  defense  to  be  made  of  Italy's  appeal  to  force 
— aside  from  the  obvious  and  sufficient  justification  that  she 
needed  Tripoli.  That  is,  that  efforts  at  a  peaceful  and  merely 
economic  penetration  of  the  country  had  been  thwarted  at 
every  step  by  the  Turkish  Government,  whether  from  anti- 
foreign  prejudice,  or,  as  is  more  likely,  from  a  well-grounded 
fear  that  the  entrance  of  Italy  in  an  economic  role  might  be 
the  prelude  to  political  intervention  supported  by  force  if 
necessary,  for  the  Turk  has  dealt  with  Europe  through 
many  centuries  and  is  wise  in  the  ways  of  the  practical  dip- 
lomat. 

Italian  immigrants,  who  had  been  going  to  Tripoli  as 
well  as  to  Tunis,  had  undeniably  been  ill-treated  by  the 
Turkish  officials.  Legal  or  illegal,  the  Turk  used  any  means 
to  discourage  the  coming  of  Italians.    Turkish  subjects  who 


The  Wars  of  the  World:  1878-1914  131 

ventured  to  sell  lands  to  the  infidel  suffered  from  threats 
or  actual  imprisonment.  Turkish  troops  used  force  to  pre- 
vent native  laborers  from  giving  their  services  to  the  Ital- 
ian settlers. 

In  spite  of  this,  Italy  had  already  made  considerable 
peaceful  progress  in  Tripoli  when  war  finally  broke  out. 
Bi-monthly  mail  service  by  steamer  from  Sicily  had  been 
established  to  all  the  principal  ports  of  Tripoli.  In  Bergasi 
there  was  an  Italian  post  office  with  a  savings  bank  and  free 
Italian  schools.  Institutions  of  about  the  same  sort  had 
been  set  up  in  other  parte  of  Tripoli  and  the  Banca  di 
Roma  maintained  Tripolitan  branches  and  had  done  a 
great  deal  towards  the  economic  development  of  the  country. 

In  1911  the  hour  for  striking  the  blow  to  secure  the 
colonies  was  as  favorable  as  could  be  expected.  The  Sub- 
lime Porte  was  in  even  more  difficulties  than  usual.  Affairs 
had  not  yet  got  well  settled  after  the  revolt  of  the  Young 
Turks.  Spain  and  France  were  arranging  what  amounted 
practically  to  the  partition  of  the  Turkish  possessions  in 
Morocco.  Bulgaria,  also  quick  to  take  advantage  of  this 
state  of  affairs,  had  but  recently  declared  her  complete 
independence. 

Europe,  beginning  to  breathe  again  after  the  crisis  at 
Agadir,  which  had  threatened  a  war  that  might  well  have 
become  general,  was  suddenly  confronted,  before  its  chan- 
cellories had  received  any  intimation  of  what  was  afoot, 
with  the  Italian  war.  Events  moved  with  amazing  swift- 
ness. An  Italian  ultimatum  was  presented  to  the  Porte  on 
September  28,  1911;  Turkish  efforts  to  temporize  were 
rejected;  and  on  the  following  day  war  was  declared.  A 
fleet  under  the  Due  d'Abruzzi  blockaded  the  port  of  Pre- 
visa  in  the  Adriatic,  and  40,000  troops  were  thrown  into 
Tripoli  with  a  speed  and  certainty  that  showed  the  smooth- 
ness of  the  working  of  the   Italian  staff,   the  result  of 


132  The  Economic  Causes  of  Modern  War 

maneuvres  held  with  this  very  purpose  only  the  year  before. 
Austria  demanded  that  her  ally  should  be  content  with  car- 
rying the  war  into  Africa  only,  and  that  Turkish  territory 
should  otherwise  be  respected.  Great  Britain  refused  to 
allow  Turkish  troops  to  pass  through  Egypt  (still  nominally 
under  Turkish  suzerainty)  on  their  way  to  Tripoli — all  this 
within  a  week. 

Turkey  was  hopelessly  defeated  and  was  forced  to  yield 
to  the  Italian  demands.  Her  misfortunes  in  Africa  pre- 
pared the  way  for  those  of  the  following  year  in  the 
Balkans. 

Though  pressure  of  population  was  the  primary  reason 
for  the  Tripolitan  war,  the  possibility  of  future  food  sup- 
plies from  agricultural  development  in  Tripoli  under 
Italian  direction,  and  of  new  markets  for  the  growing 
industrial  life  of  Italy  must  have  been  potent  considerations 
in  the  minds  of  the  Italian  statesmen  who  willed  the  war. 
Although  carried  out  on  a  smaller  scale  and  with  less  con- 
sistent success  than  that  of  the  other  Powers,  Italian 
colonial  policy  has  sprung  from  the  same  economic  necessity 
as  theirs. 

THE    BALKAN    WARS,    1912-1913 

In  the  Balkans,  war  fills  about  the  same  place  in  the 
scheme  of  things  that  baseball  does  in  America.  This  is  a 
consideration  that  must  be  borne  in  mind  constantly,  when 
one  attempts  to  estimate  the  motives  which  have  made  this 
group  of  little  states  a  veritable  hornet's  nest  for  Europe 
and  which  in  the  end  set  the  whole  world  by  the  ears.  Among 
all  the  rivalries,  economic,  racial,  religious,  nationalistic, 
which  have  produced  the  turmoil  of  the  Balkans,  the  pure 
love  of  fighting  among  its  warlike  inhabitants  has  not  been 
the  least. 

In  the  welter  of  races,  nationalities,  religions,  and  ideals 


The  Wars  oj  the  World:  1878-1914  133 

which  make  up  the  Balkan  states  of  Montenegro,  Serbia, 
Bulgaria,  Rumania,  Greece,  and  the  Turkish  vilayets 
which  in  combination  are  referred  to  as  Albania  and  Mace- 
donia, there  is  ample  cause  for  constant  wars  and  threats 
of  war.  Only  during  the  Nineteenth  Century  did  the  Balkan 
states  win  their  independence  of  Turkish  rule,  and  only 
gradually  have  they  built  up  agriculture  and  the  begin- 
nings of  industry  sufficient  to  make  their  commerce  great 
enough  to  create  any  economic  problem  at  all. 

The  Balkan  wars  have  been  produced  by  the  love  of 
fighting.  They  have  been  produced  by  the  hatred  of  the 
Moslem  for  the  Christian  and  of  the  Christian  for  the 
Moslem.  They  have  been  produced  by  the  brutality  and 
corruption  of  the  Turk  in  his  administration  of  his 
provinces.  They  have  been  produced  in  retaliation  for  mas- 
sacres— both  Christian  and  Moslem.  They  have  been  pro- 
duced in  the  effort  to  bring  races  together  under  the  same 
government.  They  have  been  the  reaction  against  oppres- 
sive taxation.  But  among  all  these,  the  economic  causes 
which  have  produced  war  cannot  be  lost  to  sight.  Balkan 
problems  would  have  settled  themselves  long  since,  were  it 
not  for  the  interference  of  European  Powers;  and  the 
motive  for  this  intervention  is  economic.  That  the  eco- 
nomic rivalries  of  the  great  Powers  have  had  most  to  do 
with  the  prevention  of  Balkan  pacification  and  of  the  ade- 
quate provision  for  the  economic  needs  of  Serbia,  Monte- 
negro, and  Bulgaria,  has  been  evident  for  years. 

Until  the  year  1912,  Turkey,  although  unable  to  main- 
tain its  suzerainty  over  its  erstwhile  vassals,  had  pursued 
with  surprising  success  the  policy  of  divide  et  impera,  play- 
ing off  one  Balkan  state  against  another,  watching  with 
satisfaction  their  difficulties  among  themselves,  and  taking 
advantage  equally  of  the  jealousies  and  rival  ambitions  of 
the  Powers  of  Europe. 


134  The  Economic  Causes  of  Modern  War 

In  1912  a  great  light  burst  upon  the  statesmen  of  the 
little  principalities.  They  realized  for  the  first  time  to 
what  an  extent  their  bickerings  among  themselves  were 
playing  into  the  hands  of  the  common  foe,  and  they  com- 
promised. March  15,  1912,  a  treaty  between  Serbia  and 
Bulgaria  put  an  end  to  the  ill-feeling  that  had  existed  since 
the  war  of  1885,  and  provided  for  joint  action  against  the 
Turk.  In  September  of  the  same  year  a  similar  treaty  was 
made  between  Greece  and  Bulgaria.  Montenegro,  though 
not  formally  bound  by  treaty,  came  to  an  understanding, 
tacit  and  implied,  though  not  formally  expressed. 

Hitherto  the  rivalry  of  the  states  had  concerned  itself 
chiefly  with  Macedonian  vilayets  still  under  Turkish  rule, 
but  populated  by  representatives  of  all  the  Slavic  races  in 
the  Balkans,  in  sufficient  number  to  give  each  state  reason 
for  claiming  the  same  territory.  By  the  terms  of  the 
treaties  this  rivalry  was  ended,  and  the  lands  to  which  each 
had  a  claim  were  specifically  delimited. 

The  ambitions  of  the  great  Powers  in  the  Balkans  may 
be  stated — too  sketchily  for  complete  accuracy — about  as 
follows:  Russia  followed  an  intermittent  policy  of  expan- 
sion toward  Constantinople,  and  continued  to  follow  a 
Pan-Slav  policy  through  which  she  hoped  to  maintain  her 
hegemony  among  the  Slavic  nations.  She  saw,  moreover,  in 
Kavalla,  a  way  of  escaping  the  menace  to  her  commerce 
and  her  naval  power  implied  in  the  Ottoman  hold  upon 
the  Dardanelles.  So  far  as  sharing  in  the  trade  of  the 
Balkans  was  concerned,  the  Russian  economic  interests 
were  slight. 

Austria-Hungary  sought  to  expand  southward  to  the 
iEgean  and  along  the  Adriatic  at  the  expense  of  Serbia, 
eyeing  with  especial  longing  the  port  of  Salonika,  on  whose 
possession  the  Serbs  were  equally  bent.  Serbian  domina- 
tion on  the  eastern  shore  of  the  Adriatic  would  jeopardize 


The  Wars  of  the  World:  1878-1914  135 

Austria's  sole  route  to  the  sea  from  Trieste  and  Fiume.  To 
the  Dual  Monarchy  the  port  of  Salonika  would  mean  a 
ready  means  of  release  for  Hungarian  and  Austrian  com- 
merce, hampered  by  insufficient  access  to  the  sea.  To 
Serbia  the  same  port  meant  also  the  long-desired  access  to 
the  sea  and  release  from  the  complete  dependence  upon 
Austrian  markets  which  the  Austrians  sought  to  impose  on 
their  smaller,  land-locked  neighbor. 

German  economic  policy  in  the  Balkans  in  most  respects 
paralleled  that  of  Austria.  The  formulation  of  the  Mittel- 
Europa  scheme  and  of  the  Drang  nach  Osten  gave  the  Bal- 
kans a  peculiar  importance  to  both  powers,  since  domina- 
tion there  was  essential  to  the  penetration  of  the  Near 
East.  If  the  Berlin-to-Bagdad  Railway  were  ever  com- 
pletely built,  a  long  section  would  have  to  run  through  this 
territory,  which  would  be  most  valuable  under  either  the 
German  or  the  Austrian  flag — a  prospect  rudely  interrupted 
by  the  formation  of  the  strong  Balkan  Confederacy. 

Great  Britain,  for  economic  reasons  and  from  strategic 
considerations  which  had  their  basis  in  economic  considera- 
tions, had  long  sought  to  check  Russian  expansion,  especially 
the  acquisition  of  Constantinople,  which  controlled  the 
route  to  India.  The  importance  of  Constantinople  de- 
termined the  policy  of  the  British  Empire  toward  Turkey, 
and  hence  toward  the  Balkans. 

The  economic  motives  for  warfare  among  the  Balkan 
states  themselves  consisted  mainly  in  desire  for  the  adjust- 
ment of  obvious  inequalities.  Montenegro,  a  tiny  princi- 
pality, rocky  and  mountainous,  with  only  a  few  fertile 
valleys,  and  with  but  a  small  opening  upon  the  Adriatic 
coast,  turned  longing  eyes  toward  the  fertile  plains  of  Mace- 
donia. In  the  end  she  hurried  into  hostilities  with  Turkey, 
risking  annihilation  if  the  support  of  the  other  Balkan 
states  should  fail,  because  of  the  realization  on  the  part  of 


136  The  Economic  Causes  of  Modem  War 

the  King's  advisers,  General  Martinovich  and  M.  Pla- 
menatz,  that  if  Europe  took  in  hand  the  reform  of  Mace- 
donia, where  conditions  had  for  years  been  a  crying  scandal 
in  international  affairs,  there  would  be  no  hope  of  Monte- 
negrin accessions. 

Bulgaria  needed  a  larger  seacoast.  She  had,  to  be  sure, 
secured  a  footing  on  the  coast  of  the  Black  Sea,  but  she,  too, 
aspired  to  reaching  the  iEgean,  where  the  Turkish  domi- 
nance at  least  would  be  less  repressive,  and  in  this  ambition 
the  Bulgarian  and  Austrian  economic  interests  came  into 
a  sharp  rivalry.  Bulgaria  also  had  a  lively  appreciation  of 
the  value  of  the  fertile  plains  of  Macedonia. 

The  condition  of  Serbia  was  the  most  precarious  of  all 
the  future  allies.  Unlike  the  others,  she  was  absolutely 
cut  off  from  the  sea,  and  her  statesmen  dreamed  of  re- 
storing the  ancient  boundaries  of  the  glorious  days  of  the 
Serbian  Empire.  She  was  an  important  market  for  Austria- 
Hungary  and  the  economic  relationship  existing  was  so  close 
that  most  of  the  Serbian  purchases  were  in  Austrian  mar- 
kets. Situated  as  she  was,  the  whims  of  the  more  powerful 
state  could  at  any  time  cause  inconvenience  and  irritation, 
or  a  situation  even  more  serious.  The  closing  of  the 
Austrian  frontiers  to  Serbian  exports  of  pigs 1  had  incensed 
the  entire  nation.  So  difficult  was  the  economic  position  of 
the  Serbs  because  of  their  restricted  boundaries,  that  M. 
Milanovich  at  one  time  feared  to  risk  a  rupture  with  Tur- 
key lest  it  should  mean  a  complete  economic  isolation. 

Greece  still  coveted  nominal  as  well  as  actual  possession 
of  Crete,  for  the  sake  of  its  fertility  as  well  as  for  racial 
reasons.  There  had  been,  besides,  difficulties  in  the  Balkans 
with  regard  to  railway  questions,  in  which  the  Turkish 
power  had  made  difficulties,  notably  in  the  case  of  the  Bul- 

1  See  p.  173. 


The  Wars  of  the  World:  1878-1914  137 

garian  effort  to  connect  railways  with  Salonika  and  the 
Greek  effort  to  secure  better  connections  with  Europe. 

With  such  a  tangle  of  rival  economic  interests,  made  more 
complex  by  the  gravity  of  racial  and  religious  problems, 
it  is  small  wonder  that  war  followed  immediately  upon  the 
completion  of  the  agreements  among  the  Balkan  states 
which  made  them  powerful  enough  to  dare  attack  their 
erstwhile  suzerain.  The  necessary  spark  was  furnished 
by  the  peculiarly  brutal  atrocities  at  Kochana,  the  culmi- 
nation of  a  long  series  of  massacres. 

Montenegro  plunged  boldly  into  the  war  alone,  October 
8,  1912,  hoping  for  the  support  of  the  other  states,  and 
knowing  her  cause  lost  if  she  did  not  secure  it.  Within 
ten  days  war  existed  between  Turkey  and  all  the  Balkan 
states  except  Rumania. 

The  success  of  the  Allies  was  beyond  all  their  expecta- 
tions. Serbian  troops  drove  southward  and  secured  the 
coveted  outlet  to  the  Adriatic  at  Durazzo,  November  28th, 
thereby  checkmating  Austrian  ambitions  for  southward 
expansion.  Montenegro  forced  its  way  to  Scutari.  Greece 
engaged  the  Turkish  navy  and  seized  Salonika,  November 
8th.  The  Bulgarians,  in  two  pitched  battles,  Kirk  Kilisse, 
October  22-24,  and  Lule  Burgas,  October  29-31,  drove 
the  Turks  behind  the  Tchataldja  lines,  the  last  defenses  of 
Constantinople. 

Turkish  requests  for  mediation  led  to  a  peace  conference 
in  London,  December  16,  1912,  where  the  Powers  of  Europe 
were  represented  as  well  as  the  belligerents.  The  economic 
rivalry  which  existed  between  Serbia  and  Austria  appeared 
in  the  difficulties  over  Durazzo,  which  the  Serbs  insisted 
upon  retaining,  with  a  corridor  to  the  sea,  and  which  the 
Austrians  knew  would  affect  their  interests  in  Albania,  and 
along  the  Adriatic.  Austria  threatened  to  mobilize.  The 
Entente  Powers  supported  the  Balkan  states,  but  Serbia  had 


138  The  Economic  Causes  of  Modern  War 

at  length  to  give  up  her  port,  with  assurances  of  access  to 
the  sea.  January  6th,  Turkey,  finding  the  negotiations 
going  against  her,  offered  protest.  The  Balkan  allies  sus- 
pended discussion  and  resumed  hostilities. 

Bulgarians  and  Serbs  forced  their  way  to  Adrianople; 
and  Montenegro,  defying  Europe,  took  Scutari.  Greece  had 
kept  up  a  show  of  hostilities  even  while  the  conference  was 
in  progress.  May  30,  1913,  peace  was  finally  made  after 
a  second  conference  in  London,  which  began  May  3. 
War  immediately  broke  out  among  the  lately  allied  states 
over  the  distribution  of  the  spoils,  Serbia  having  been 
deprived  of  what  she  had  expected,  through  the  jealousy 
of  Austria,  which  had  led  to  the  erection  of  the  independent 
state  of  Albania,  blocking  Serbia  from  the  sea.  This  was 
the  outcome  of  economic  difficulties  of  long  standing.  The 
chief  advantage  to  Austria  was  the  retention  of  her  monop- 
oly of  Serbian  trade  so  long  as  the  Serbs  were  cut  off  from 
other  nations  by  their  lack  of  a  port.  Bulgaria  was  willing 
to  attack  Serbia  rather  than  give  up  any  of  the  gains  of  the 
war,  which  were  greatly  to  her  commercial  advantage. 

The  economic  causes  of  the  Balkan  Wars  fall  into  two 
categories,  the  desire  for  expansion  of  the  great  Powers 
and  those  of  the  Balkan  states  themselves.  It  is  true  that 
the  Powers  whose  interference  frustrated  the  efforts  of  the 
smaller  states  did  not  contemplate  immediate  territorial 
aggrandizement  at  the  expense  of  the  states  that  they 
bullied.  Both  Germany  and  Austria,  however,  looked  for 
this  eventually,  in  connection  with  their  efforts  to  build 
up  empires  which  would  supply  them  with  the  food,  mar- 
kets, and  raw  materials  that  they  required.  Their  Balkan 
policies  were  necessary  to  the  furtherance  of  this  design. 
Russia  was  involved  mainly  through  her  desire  to  gain 
access  to  the  Mediterranean;  and  England  through  her 
perpetual   concern    over    Constantinople,    even    after   the 


The  Wars  oj  the  World:  1878-1914  139 

Anglo-Russian  understanding  of  1907.  French  interests 
were  involved  because  of  the  large  sums  loaned  in  the 
Balkans.1  Evidently,  with  the  possible  exception  of  France, 
all  were  directly  brought  into  the  negotiations  and  to  the 
verge  of  conflict,  because  of  the  familiar  need  of  territorial 
expansion  and  the  defense  of  colonial  territory  already 
acquired.    The  French  motives  were  financial. 

Although  the  pressure  of  population  among  the  Balkan 
states  was  not  serious,  their  economic  motives  did  not  other- 
wise greatly  differ  from  those  of  the  other  powers.  They, 
too,  sought  to  satisfy  what  they  regarded  as  their  economic 
requirements. 

The  vast  importance  of  economic  pressure  as  an  element 
in  the  causation  of  the  wars  of  the  world  since  1878  is 
now  evident,  not  merely  from  a  priori  examination  of  the 
situation  of  the  states  of  Europe,  as  regards  population, 
manufactures,  and  the  supply  of  food  and  raw  materials, 
but  also  from  the  study  of  the  origin  of  the  twenty 
most  important  conflicts  of  the  period.  In  none  of  these 
is  an  important  economic  motive  lacking. 

Whether  the  cause  of  hostilities  be  the  eternal  clash  be- 
tween colonist  and  native,  as  in  the  Zulu  War,  the  Abys- 
sinian Wars,  the  fighting  in  Annam,  the  Boxer  Rebellion, 
and  the  Herero  Rising;  whether  it  be  an  imperial  impulse 
to  acquire  further  territory  or  to  safeguard  investors,  as 
in  the  Boer  Wars  and  the  Occupation  of  Egypt,  the  Nitrate 
War,  the  Greco-Turkish  and  Italo-Turkish  Wars,  the  Bal- 
kan Wars,  and  the  series  of  wars  in  the  Far  East;  or  whether 
it  be  an  effort  to  win  a  strategic  frontier  for  commercially 
profitable  territory  already  acquired, — as  was  Great  Britain's 
attempt  on  Afghan  lands  for  the  protection  of  India — the 
quarrel  is  economic  at  its  root. 

'These  loans  amounted  to  1,000,000,000  francs  in  1912.    See  p.  193. 


140  The  Economic  Causes  of  Modern  War 

If  every  state  possessed  a  stationary  population  such  as 
that  of  France,  and  immigration  problems  were  thus  ended ; 
if  every  state  were  economically  self-sufficing  as  regards 
food  and  raw  materials,  and  had  unhindered  access  to  the 
markets  of  the  world — there  would  be  no  need  for  colonies 
and  spheres  of  influence.  With  them  would  vanish  the 
squabbles  over  naval  bases,  the  ruthless  crushing  of  weak 
native  states,  the  safeguarding  of  lines  of  transport,  and  the 
ever-present  spectre  of  national  starvation  and  unemploy- 
ment should  they  be  cut.  In  one  fashion  or  another,  as 
this  survey  of  recent  history  has  shown,  such  difficulties 
have  been  at  the  root  of  all  hostilities. 

In  all  of  the  great  wars,  an  economic  problem  can  be  seen 
as  the  fundamental  cause  which  makes  conflict  necessary, 
and  though  not  always  apparent  to  the  peoples  who  are 
being  led  into  war  nor  to  the  soldiers  who  fight,  it  is  usually 
clear  enough  to  the  statesmen  whose  negotiations  break 
off  as  war  begins.  It  is  equally  apparent  to  any  one  who 
closely  scrutinizes,  not  merely  the  record  of  political  events 
and  diplomatic  interchanges,  but  the  statistics  which  show 
the  movements  of  emigration  and  immigration,  the  sources 
of  food  supplies  and  raw  materials,  and  the  commercial 
reports  which  indicate  the  never-ceasing  struggle  for  mar- 
kets. 


CHAPTER  IV 

THE    ECONOMIC    MOTIVES    OF    THE    WORLD    WAR:     1914-1918 

Underneath  all  the  clamor  about  making  the  world 
safe  for  democracy,  the  sins  of  militarism,  the  guilt  of  the 
German,  the  neutrality  of  Belgium,  and  the  saving  of 
civilization  from  the  beast,  has  lain  the  economic  motive, 
in  the  World  War  as  in  all  others. 

Never  has  economic  rivalry  during  the  years  preceding 
hostilities  been  more  evident  as  a  war-cause,  although  the 
ethical  and  idealistic  questions  at  stake  have  served  to 
obscure  it;  and  the  governments  involved  (even  when  most 
solicitous  for  the  safeguarding  of  their  economic  interests) 
have  quite  naturally  preferred  to  direct  popular  attention 
to  other  portions  of  their  policy. 

Not  until  the  Peace  Conference  did  the  peoples  of  the 
various  warring  countries,  and  particularly  of  the  United 
States,  begin  to  realize  how  vast  were  the  economic  ques- 
tions and  interests  underlying  the  war. 

Great  Britain,  no  doubt,  did  go  to  war  to  safeguard  Bel- 
gium— the  more  so  because  only  thus  could  the  safety  of 
her  own  territory  be  assured.  (She  has  been  by  no  means 
so  much  concerned  over  the  safety  of  small  peoples  in  other 
portions  of  the  globe.)  France,  no  doubt,  fought  to  ward 
off  the  German  hordes  bent  upon  carrying  Kultur  to  Paris, 
even  though  the  French  themselves  had  not  hesitated  to 
carry  their  own  civilization  to  other  benighted  portions  of 
the  globe  by  force  of  arms.  Austria-Hungary,  undoubtedly, 
was  righteously  indignant  over  the  murder  of  the  Crown 
Prince  Ferdinand.     Even  Germany  was  not  wholly  insin- 

141 


142  The  Economic  Causes  oj  Modern  War 

cere  in  insisting  that  she  fought  of  necessity,  ringed  about 
by  armed  foes,  jealous  of  her  progress  and  seeking  her  de- 
struction in  order  to  eliminate  from  the  field  their  most 
formidable  competitor;  for  Germany  was  the  most  formi- 
dable competitor  of  most  of  the  industrial  countries  of  the 
world. 

The  origins  of  the  war  are  to  be  found  in  the  economic 
rivalries  of  the  great  Powers,  not  to  the  exclusion  of  the 
idealistic  war  aims  which  have  been  put  forth,  but  none 
the  less  really  and  actually.  The  murder  of  the  Crown 
Prince  at  Sarajevo  or  the  invasion  of  Belgium  did  not  cause 
the  war  or  the  participation  of  any  particular  nation.  These 
events  precipitated  war  in  the  same  sense  in  which  a  sharp 
tap  upon  a  test  tube  will  precipitate  a  salt  from  a  chemical 
solution  just  upon  the  point  of  saturation.  The  funda- 
mental causes  lie  behind  that. 

Colonial  rivalries  in  Asia,  Africa,  and  the  islands  scat- 
tered here  and  there  about  the  globe;  friction  over  spheres 
of  economic  influence;  difficulties  over  coaling  stations  and 
the  safeguarding  of  trade  routes;  displacing  by  one  nation 
of  another  in  a  favorite  and  long-accustomed  field — all  these 
have  contributed  to  the  era  of  fear,  hate,  and  distrust  that 
broke  into  war  at  last.  Out  of  commercial  rivalries  and 
rival  merchant  fleets  have  grown  up  hostile  navies.  Out 
of  ill-adjusted  economic  frontiers  and  the  resultant  suffer- 
ing have  grown  great  military  establishments.  In  the  end 
war  had  to  come. 

The  surprising  thing  is  not  that  the  World  War  came  at 
last,  but  that  it  did  not  come  long  before.  The  Casablanca 
affair  in  1908;  the  Austrian  violation  of  the  Treaty  of  Ber- 
lin in  the  seizure  of  Bosnia  and  Herzegovina  in  1908;  the 
Agadir  incident  in  1911;  the  wars  in  the  Balkans  in  1912- 
1913,  might  any  one  of  them  have  set  the  world  ablaze, 
and  every  one  of  them  did  actually  come  near  doing  so. 


The  World  War:  1914-1918  143 

These  incidents  were  of  minor  importance  in  themselves — 
a  German  consul's  broken  cane,  the  annexation  of  two  small 
provinces,  the  presence  of  a  gunboat  in  an  African  harbor, 
the  quarrels  of  a  few  small  nations.  But  each  one  of  them 
raised  the  spectre  of  a  world  war  because  the  economic 
rivalry  existing  among  all  of  the  great  Powers  of  Europe 
had  led  to  friction  so  bitter  and  mutual  distrust  so  general, 
to  political  rivalries,  military  rivalries,  naval  rivalries,  so 
fierce,  that  the  death  of  a  single  man  could  bring  the  whole 
world  into  death  grips. 

In  order  to  simplify  their  treatment,  the  fundamental 
economic  causes  of  the  World  War  may  be  classified  thus: 

Anglo-German  trade  rivalry. 

Franco-German  trade  rivalry. 

The  Drang  nach  Osten  and  the  Bagdad  Railway. 

Austrian  and  Italian  economic  ambitions. 

In  all  of  these  the  group  of  economic  motives  already 
familiar  is  to  be  observed.  Out  of  these  four  springs  all  of 
the  international  friction  which  reached  its  logical  culmina- 
tion in  1914.  Out  of  the  rivalry  between  Great  Britain 
and  Germany  come  the  quarrelling  over  colonies  and  the 
growth  of  armaments,  military  and  naval;  out  of  them 
come  the  mutual  distrust  of  the  two  nations,  fear,  then 
hatred,  then  war.  In  France  there  was  the  "revanche" 
because  of  the  two  lost  provinces;  yet  even  this  was  one 
part  national  sentiment  to  nine  parts  economics — princi- 
pally the  question  of  coal  and  iron.  "Revanche"  might  have 
been  wholly  forgotten,  too,  had  not  the  German  colonial 
system  begun  to  gall  France  with  its  machinations  in 
Morocco.  Out  of  the  Drang  nach  Osten  came  a  part  of  the 
Balkan  troubles,  British  and  French  fears  for  commercial 
supremacy  and  the  safety  of  oversea  dominions.  The  Bag- 
dad Railway,  a  mere  private  commercial  enterprise  in  the 


144  The  Economic  Causes  of  Modern  War 

beginning,  became  an  economic  and  military  threat  to 
France,  England,  and  Russia.  The  Italian  and  Austrian 
ambitions  for  economic  expansion  have  all  added  to  the 
unrest  in  the  Balkans.  To  Austria's  own  commercial  am- 
bitions is  due  the  suppression  of  Serbia  which  bred  the 
resentment  that  found  expression  in  an  assassin's  bullet 
and  a  world  at  war. 


ANGLO-GERMAN  TRADE  RIVALRY 

Germans  and  German  sympathizers  were  convinced  in 
August,  1914,  that  whatever  the  reasons  alleged,  the  real 
cause  of  British  entrance  into  the  war  was  jealousy  of  the 
commercial  development  of  modern  Germany  and  the  de- 
termination to  crush  at  all  costs  the  most  serious  trade 
rival  that  had  ever  faced  the  British  Empire.1  The  thesis 
rested  on  the  assumption,  first,  that  Germany  and  Great 
Britain  were  necessarily  bitter  foes,  one  of  which  must 
destroy  the  other;  and  second,  that  Great  Britain,  without 

1  This  idea  is  repeated  in  the  war  utterances  of  leaders  in  all  depart- 
ments of  German  thought,  economists,  historians,  politicians,  soldiers, 
even  theologians  and  clergymen.  It  formed  the  main  theme  of  Count 
Reventlow's  pamphlet  Der  Vampir  des  Festlandes  that  Great  Britain's 
consistent  policy  during  three  centuries  had  been  to  destroy  her  commer- 
cial rivals  as  they  successively  arose,  Spanish,  Dutch,  French,  and  last  of 
all  the  Germans. 

In  his  volume  England  and  Germany,  published  as  a  defensive  com- 
mentary on  his  earlier  work,  Germany  and  the  Next  War,  General  von 
Bernhardi  again  gives  voice  to  this  view,  "England,  this  land  which  claims 
as  its  own  private  property  all  liberty,  all  justice,  all  spiritual  superior- 
ity, has  conspired  to  overthrow  and  destroy  Germany,  which  never  vio- 
lated England's  rights.  And  why?  Only  because  German  commerce  seems 
to  be  growing  burdensome  to  England."     {England  and  Germany,  p.  76.) 

Professor  Otto  Hinze,  the  historian,  of  the  University  of  Berlin,  reit- 
erates the  same  view:  "For  almost  twenty  years  the  successful  compe- 
tition of  German  industry  in  the  commerce  of  the  world  has  aroused  the 
jealousy,  the  envy  and  the  hatred  of  British  business  men  and  of  the 
government  which  they  control.  .  .  .  We  desired  to  develop  slowly  in 
peaceful  competition  with  England,  until  one  day  the  older  World  Power 


The  World  War:  1914-1918  145 

resort  to  arms,  could  not  stand  the  competition  which  the 
tremendous  advance  of  Germany  had  brought  against  her. 
There  is  no  denying  that  the  loss  of  markets  and  the  de- 
crease of  trade  in  certain  commodities,  and  the  alarming 
way  in  which  German  goods  had  forced  their  way  into  mar- 
kets long  regarded  as  exclusively  British,  were  viewed  with 

would  recognize  Germany  as  possessing  equal  rights  in  determining  the 
politics  of  the  world.  This  development  England  sought  to  preclude  by 
the  war."     (Modern  Germany  in  Relation  to  the  Great  War,  pp.  53-54.) 

Friedrich  Naumann,  a  prominent  member  of  the  Reichstag,  writes:  "We 
are  unloved  because  we  have  found  a  method  of  work  in  which  now 
and  for  a  long  time  to  come  no  other  European  nation  can  imitate  us, 
and  which  consequently  the  others  do  not  regard  as  fair."  (Central  Eu- 
rope, p.  118.) 

The  collection  of  German  war  utterances  made  by  the  Dane,  J.  P.  Bang, 
under  the  title  Hurrah  and  Hallelujah,  teems  with  variations  on  the  same 
theme.  The  distinguished  theologian,  Adolf  Harnack,  in  the  compilation 
Das  Grossere  Deutschland  (P.  Rohrback,  editor)  declares:  "England  is 
leading  the  tremendous  world  war  against  us,  and  doing  so  from  base 
competitive  envy"  (p.  164). 

In  a  collection  of  war  sermons,  Deutsche  Reden  in  Schwerer  Zeit,  Otto 
von  Gierke  exclaims:  "The  tremendous  progress  of  Germany  in  commerce, 
industry,  etc.,  called  forth  the  envy  of  their  neighbours,  and  they  leagued 
themselves  in  the  infamous  attempt  to  strangle  Germany  by  their  supe- 
rior force,  an  attempt  emanating  from  the  degenerate  English  shop- 
keeper soul,  which  craftily  pulled  the  strings,  until  at  last  it  summoned 
up  courage  for  its  unheard-of  treachery"  (p.  150). 

Dean  G.  Tolzien  of  Schwerin,  in  a  similar  compilation,  Vaterlandische 
Evangelische  Kriegsvortrdge,  echoes  the  same  notion:  "Is  there  any  one 
who  does  not  know  why  England  declared  war?  Why?  As  Russia  from 
greed  of  power,  as  France  from  a  craving  for  revenge,  so  England  from 
jealousy.  From  shop-keeper  spite.  Because  she  wanted  to  earn  the  thirty 
pieces  of  silver"  (p.  126). 

In  this  connection  an  extract  from  the  famous  leader  in  the  London 
Saturday  Review  of  September  11,  1897,  is  extremely  apropos:  "A  mil- 
lion petty  disputes  build  up  the  greatest  cause  of  war  the  world  has  ever 
seen.  If  Germany  were  extinguished  tomorrow,  the  day  after  tomorrow 
there  is  not  an  Englishman  in  the  world  who  would  not  be  the  richer. 
Nations  have  fought  for  years  over  a  city  or  a  right  of  succession;  must 
they  not  fight  for  two  hundred  and  fifty  million  pounds  of  commerce? 
.  .  .  England  has  awakened  to  what  is  alike  inevitable  and  her  best  hope 
of  prosperity.  'Germaniam  esse  delendam.' "  (Saturday  Review,  84:278- 
279:  S.  11,  '97.)  That  passage  was  widely  read  and  long  remembered 
across  the  North  Sea. 


146  The  Economic  Causes  of  Modern  War 

a  good  deal  of  consternation  as  well  as  anger  in  Great 
Britain.  The  situation  was  summed  up  by  Mr.  H.  G.  Wells, 
when  he  wrote:  x 

"We  in  Great  Britain  are  now  intensely  jealous  of  Germany. 
We  are  intensely  jealous  of  Germany  not  only  because  the  Ger- 
mans outnumber  us  and  have  a  much  larger  and  more  diversi- 
fied country  than  ours,  and  lie  in  the  very  heart  and  body  of 
Europe,  but  because  in  the  last  hundred  years,  while  we  have 
fed  on  platitudes  and  vanity,  they  have  had  the  energy  and 
humility  to  develop  a  splendid  system  of  national  education, 
to  toil  at  science  and  art  and  literature,  to  develop  social  organ- 
ization, to  master  and  better  our  methods  of  business  and  in- 
dustry, and  to  clamber  above  us  in  the  scale  of  civilization. 
This  has  humiliated  and  irritated  rather  than  chastened  us,  and 
our  irritation  has  been  greatly  exacerbated  by  the  swaggering 
bad  manners,  the  talk  of  'Blood  and  Iron'  and  Mailed  Fists,  the 
Welt-Politik  rubbish  that  inaugurated  the  new  German  phase. 

"The  British  middle-class,  therefore,  is  full  of  an  angry,  vague 
disposition  to  thwart  that  expansion  which  Germans  regard  very 
reasonably  as  their  natural  destiny ;  there  are  all  the  possibilities 
of  a  huge  conflict  in  that  disposition.  .  .  ." 

German  trade  in  all  parts  of  the  world  had  grown  miracu- 
lously while  English  trade  had  developed  at  a  rate  which 
was  normal  enough,  but  which  bore  no  comparison  to  the 
rapid  rise  of  Teutonic  commerce.  In  the  forty  years  fol- 
lowing the  Franco-Prussian  War,  the  trade  of  the  new 
Empire  increased  170  per  cent.,  while  the  trade  of  Great 
Britain  increased  130  per  cent.  Even  during  the  first  decade 
of  the  Twentieth  Century,  when  the  first  outburst  of  Ger- 
man activity  was  over,  the  rate  of  increase  continued  to  be 
in  excess  of  that  of  her  rival  on  the  other  side  of  the  North 
Sea. 

1  An  Englishman  Looks  at  the  World,  pp.  36-37.  This  book,  published 
only  a  few  weeks  before  the  outbreak  of  the  war,  contains  some  aston- 
ishingly shrewd  forecasts  of  what  has  actually  taken  place. 


The  World  War:  1914-1918  147 

The  rate  at  which  this  went  on  is  easily  seen  in  the  sta- 
tistics for  the  years  following  the  Franco-Prussian  War:  x 

In  millions  of  pounds  sterling   {20  marks,  1  -pound) : 

United  Kingdom  Germany 

Imports      Re-exports      Exports  Imports  Exports 

1870    303                 44                 200                 173  125 

1880    411                  63                 223                 142  145 

1890    420                 64                 263                 214  166 

1900    523                 63                 291                 302  239 

1910    678               104                430                465  382 

Even  in  the  cotton  trade  Germany  had  overtaken  and 
all  but  outstripped  Great  Britain,  for  while  between  1885 
and  1886  the  British  port  of  Liverpool  had  handled  2,558,- 
798  bales  and  the  correspondingly  important  German  port 
of  Bremen  only  530,451,  after  the  German  progress  began, 
in  the  single  year  1911-1912,  Liverpool  handled  only  3,690,- 
800  bales  as  against  Bremen's  2,792,000.  The  long-estab- 
lished British  textile  industry  was  being  hard  put  to  it  by 
the  new  German  factories;  and  supremacy  in  the  iron 
industry  had  long  since  been  wrested  from  the  United 
Kingdom,  the  success  of  the  competitors  being  made  possible 
by  the  Lorraine  iron  fields  and  the  invention  of  the  Eng- 
lishman, Thomas. 

Finally,  German  progress  came  to  touch  British  pride 
and  pocket-book  alike  at  their  most  sensitive  spot.  Directed 
by  Albert  Ballin  and  his  co-workers,  the  German  maritime 
fleet  began  to  offer  serious  competition  on  the  sea  which 
Britons  have  for  generations  claimed^  to  rule.  It  is  only 
a  generation  since  Germany  bought  her  ships  in  England. 
She  was  now  building  her  own  vessels  and  carrying  her 
own  goods  in  them.  The  Hamburg-American  and  North 
German  Lloyd  became  two  of  the  largest  shipping  concerns 
in  the  world. 

1  B.  E.  Schmitt:  England  and  Germany,  p.  99.  The  German  figures  for 
1870  are  actually  for  1872,  the  earliest  available.  The  statistics  imme- 
diately succeeding  are  from  the  same  work. 


148  The  Economic  Causes  of  Modern  War 

Added  to  this  was  the  poverty  and  misery  of  certain 
classes  of  society  in  the  British  Isles,  part  of  which  was 
due  to  the  collapse  of  business  enterprises  owing  to  the 
superior  efficiency  of  the  competing  Germans.  The  realiza- 
tion that  twelve  million  people,  according  to  the  statement 
of  a  British  publicist,1  lived  on  the  verge  of  hunger,  increased 
the  bitterness  which  the  English  felt.  The  seriousness  of 
German  rivalry  was  kept  before  their  attention  by  the  con- 
tinued discussion  of  measures  proposed  to  keep  the  Ger- 
mans from  securing  the  markets  that  were  left  to  imperial 
Britain. 

It  is  absurd,  on  the  other  hand,  to  regard  the  British 
Empire  as  completely  outstripped  in  the  economic  contest 
and  because  of  its  hopelessness  forced  to  resort  to  arms  and 
appeal  to  the  strength  of  its  superior  fleet  in  order  to  main- 
tain its  position  in  the  economic  world.  The  figures  for 
export  and  import  of  the  two  countries  in  the  years  between 
1899  and  1913  give  the  lie  to  this  without  need  of  further 
argument:2 

In  millions  o)  pounds  sterling: 

United  Kingdom  Germany 

Imports  Re-exports      Exports  Imports  Exports 

1899    485  65  264  289  218 

1900    524  63  291  302  239 

1901    522  68  280  286  225 

1902    528  65  283  290  241 

1903    543  69  291  316  255 

1904    551  70  301  343  265 

1905    565  78  330  372  292 

1906    607  85  376  422  324 

1907    645  92  426  450  355 

1908    593  80  377  404  324 

1909    625  91  378  443  343 

1910    678  104  430  465  382 

1911    680  102  454  477  405 

1912    745  112  487  550  454 

1913    769  109  525  534  495 

1  Sir  Hugh  Campbell-Bannerman,  in  his  speech  at  Perth,  June  5,  1903. 
aB.  E.  Schmitt:  England  and  Germany,  p.  102. 


The  World  War:  1914-1918  149 

It  is  evident  at  a  glance  not  only  that  Great  Britain  has 
been  in  the  lead  so  far  as  volume  of  business  is  concerned 
but  also  that,  except  for  the  depression  resulting  from  the 
Boer  War,  her  rate  of  increase  has  not  been  very  far  behind 
that  of  her  rival. 

In  1914  Germany  was  having  economic  difficulties  of  her 
own.  The  period  of  expansion  with  which  the  year  1912 
had  opened  was  followed  by  disaster  because  of  railway  dis- 
organization, and  the  financial  difficulties  resulting  from  the 
war  in  the  Balkans.  Shortage  of  capital,  which  had  first 
made  its  appearance  at  the  time  of  the  Agadir  crisis,  was 
very  noticeable  in  1913,  reaching  such  an  extent  that  gov- 
ernment bonds  did  not  readily  secure  buyers.  The  value 
of  the  new  industrial  enterprises  decreased  from  134,000,000 
pounds  in  1911  and  146,000,000  pounds  in  1912,  to  87,000,- 
000  in  1913.  Westphalian  manufacturers  were  compelled  to 
reduce  production;  Bavarian  industries  were  in  difficulty; 
and  the  baskets,  cane,  furniture,  granite,  and  paint  which 
had  been  going  to  the  British  market  were  supplanted  by 
British  manufactures.  The  unemployment  problem  was 
beginning  to  show  itself  at  the  same  time  that  the  cost  of 
living  rose. 

The  existence  of  such  a  situation  makes  it  evident  that 
Great  Britain  could  not  possibly  have  been  solely  actuated 
in  entering  the  war  by  mere  trade  jealousy.  This  fact  is 
even  more  clearly  shown  by  the  opposition  of  more  than 
half  the  British  manufacturers  to  a  protective  tariff,  which 
would  have  ended  the  difficulty  with  German  "dumping" 
and  would  have  lessened  the  severity  of  competition  gener- 
ally. There  were  the  best  of  indications  in  1914  that  the 
worst  danger  from  Germany  to  British  commerce  was 
over;  and  at  all  events  the  cost  of  the  war  was  far  greater 
than  any  economic  loss  could  have  been. 
Yet  no  one  can  seriously  deny  that  the  commercial  rivalry 


150  The  Economic  Causes  of  Modern  War 

had  both  directly  and  indirectly  a  very  considerable  influ- 
ence in  producing  the  war,  even  though  in  itself  alone  it 
might  not  have  produced  the  four  years  of  fighting.  It 
fostered  bitterness  and  ill-feeling  between  the  two  coun- 
tries, and — a  fact  of  especial  importance — it  was  the  pri- 
mary cause  of  the  naval  rivalry  which  led  to  the  fear  of 
German  invasion — a  veritable  nightmare  among  a  certain 
class  of  Englishmen.1 

The  German  navy  was  built  as  German  commerce  grew 
and  German  colonies  and  trade  routes  needed  protection. 
It  was  a  response  to  an  economic  need,  but  it  was  also 
a  threat  to  the  very  existence  of  the  island  empire  that 
can  live  only  so  long  as  its  fleet  controls  the  seas.  It 
is  not  possible  within  the  limits  of  this  essay  to  trace  the 
rise  of  Germany's  fleet  and  the  alarm  which  it  occasioned  in 
England.  The  important  point  for  our  purposes  is  that 
it  was  the  inevitable  outcome  of  the  spread  of  German  com- 
merce over  the  globe,  and  that  the  naval  rivalry  which  had 
so  very  much  to  do  with  causing  the  Great  War  is  really 
only  a  slightly  disguised  kind  of  economic  rivalry. 

FRANCO-GERMAN    TRADE    RIVALRY 

Prevalent  ideas  regarding  the  relations  between  France 
and  Germany  since  the  cession  of  Alsace  and  Lorraine  in 
1870  have  been  so  colored  by  the  "revanche"  that  it  offers 
the  most  convenient  starting  point  for  a  discussion  of  the 
points  of  economic  friction  between  the  two  countries.  The 
"revanche"  has  been  popularly  thought  of  as  a  matter  of 
national  sentiment,  and  the  eyes  of  the_  world  have  been 
fixed  oftener  upon  the  wreaths  before  the  statue  of  Strass- 

1  Richard  Harding  Davis's  story  of  three  college  boys  who  don  German 
uniforms,  terrorize  the  United  Kingdom,  and  cause  a  complete  mobiliza- 
tion of  the  British  army,  is  an  exaggeration,  to  be  sure,  but  not  a  dis- 
tortion of  the  British  state  of  mind. 


The  World  War:  1914-1918  151 

burg  among  the  cities  of  France,  than  upon  the  iron  fields 
of  Lorraine. 

The  French  desire  for  the  re-possession  of  Lorraine  has 
been  due  to  something  besides  the  natural  patriotic  desire 
to  see  the  lost  provinces  again  under  the  tricolor,  just  as  the 
desire  of  the  Germans  to  retain  it  has  been  due  to  a  per- 
fectly practical  and  unsentimental  appreciation  of  its  value. 
From  the  mines  of  Lorraine  came  21,000  of  the  28,000  tons 
of  iron  ore  that  Germany  was  consuming  annually.  Be- 
sides the  iron,  there  are  coal  deposits  in  these  territories 
sufficient,  when  combined  with  the  output  of  the  West- 
phalian  deposits,  to  provide  the  entire  German  Empire 
with  all  the  fuel  that  is  required  by  all  its  industries. 

The  Germans,  notwithstanding,  desired  more  than  they 
already  possessed  of  the  French  iron  fields,  for  their  geolo- 
gists in  1871  had  made  the  fatal  blunder  of  supposing  that 
all  the  iron  ore  on  the  Briey  plateau  was  inside  the  boundary 
line  fixed  by  the  treaty.  Subsequent  discoveries  showed  that 
by  far  the  richer  deposits  still  remained  in  French  hands. 

Since  1900  the  French  iron  fields  at  Briey  have  con- 
tributed heavily  to  the  republic's  production  of  ore. 
Since  1907  France  has  ceased  to  be  an  importer  of  iron 
and  has  begun  exportation  to  Belgium,  Holland,  and  Ger- 
many itself.  The  German  business  men,  who  sought  both 
to  check  French  expansion  and  to  reap  what  advantage  they 
could  from  the  situation,  had  by  1910  acquired  partial 
control  over  about  one-fifth  of  the  Briey  mines.1 

In  1910  Germany  possessed  3,608,000  tons  of  ore  remain- 
ing in  the  mines  scattered  in  various  parts  of  the  Empire, 
as  against  3,300,000  tons  of  French  ore  in  mines  temptingly 

1Krecke:  "Eisenerz  und  Kohle  in  Franzosisch-Lothringen,"  Stahl  und 
Eisen,  1910,  p.  8.  Quoted  by  E.  F.  Gay:  "French  Iron  and  the  War," 
Military  Historian  and  Economist:  i : 308 :  Jy.,  '16. 


152  The  Economic  Causes  of  Modern  War 

close  to  the  German  frontier.1  It  was  these  mines  that 
during  the  recent  war  determined  the  German  strategists 
to  win  Nancy  and  to  hold  the  Briey  and  Longwy  basins 
at  all  costs. 

One  circumstance  alone  hindered  the  French:  their  de- 
pendence for  coal  upon  the  deposits  of  Westphalia.  In  this 
respect  their  iron  industry  remained  subject  to  a  degree 
of  German  control,  a  situation  which  it  was  in  their  power 
to  remedy  by  purchases  in  the  English  market  and  by 
further  development  of  their  own  resources. 

The  immense  development  of  the  German  iron  industry 
is  due  to  the  discovery  of  the  English  metallurgist,  Sidney 
Gilchrist  Thomas.  The  Lorraine  ores  contain  a  great  deal 
of  phosphorus,  which  unless  removed  from  the  steel  in  the 
process  of  converting,  renders  it  too  brittle  to  be  of  use. 
The  Bessemer  process,  based  on  experiments  with  the  Eng- 
lish ores,  which  are  free  from  phosphorus,  could  not  effect 
this  removal,  and  consequently  the  value  to  the  German 
Empire  of  the  recently-seized  Lorraine  iron  fields  was  im- 
paired. The  necessity  for  importing  either  the  purer 
grades  of  ores  from  Spain  and  Sweden,  or  else  Bessemer 
steel  already  converted  from  England,  had  hindered  German 
industry. 

Thomas,  who  had  studied  the  problem  of  the  elimination 
of  phosphorus  since  1870,  reached  a  practical  solution  in 
1875.  He  secured  the  co-operation  of  his  cousin,  Percy 
Gilchrist,  and  in  1877  took  out  his  first  patent,  making 
formal  announcement  of  his  new  method  in  1878.  His 
invention,  which  employed  a  lining  of  magnesia  or  mag- 
nesia limestone  in  the  converter,  attracted  little  attention 
in  England;  but  it  was  regarded  as  of  so  much  importance 
among  Continental  iron-masters,  to  whom  the  phosphorus 

1<(Iron  Ore  Resources  of  the  World,"  Stockholm,  1910:  i:xxv.  Also 
quoted  by  Gay,  loc.  cit. 


The  World  War:  1914-1918  153 

problem  was  of  dire  importance,  that  a  single  steamer  is 
said  to  have  brought  two  applicants  for  his  patent  rights. 

The  tremendous  impetus  which  gave  Germany  world 
supremacy  in  the  iron  industry  within  a  comparatively  short 
period,  dates  from  this  year.  The  Bessemer  process  had 
been  practically  valueless  to  the  Germans.  Once  the  new 
method  was  adopted,  the  Lorraine  fields,  where  iron  and 
coal  lay  near  together,  were  almost  ideal  for  iron  production. 

The  iron  and  coal  which  were  making  the  wealth  of 
Germany  prior  to  the  beginning  of  the  war  in  1914,  and 
which  she  guarded  so  carefully  that  she  retained  the  use 
of  them  during  most  of  the  period  of  hostilities,  were  in  the 
very  territory  which  had  been  wrung  from  France.  From 
lack  of  the  minerals  that  were  being  mined  in  territories 
that  they  regarded  as  being  rightfully  their  own,  the  French 
until  1907  found  their  industries  gravely  hampered.  Even 
the  enormous  development  of  the  iron  fields  in  the  Meurthe- 
et-Moselle  district,  which  the  Germans  failed  to  take  in 
1870,  did  not  reconcile  them  to  the  loss  of  the  Lorraine 
fields. 

This  is  one  of  the  reasons  why  the  policy  of  "revanche" 
did  not  die  out.  In  the  minds  of  the  people  "revanche" 
meant  a  patriot's  desire  to  see  the  hereditary  foe  humbled 
and  the  lost  provinces  again  restored  to  France.  But  in 
the  minds  of  the  masters  of  French  industry  and  the  jour- 
nalists who  formed  the  popular  mind,  "revanche" — what- 
ever else  it  may  have  meant — implied  the  restoration  with- 
in French  boundaries  of  the  deposits  of  coal  and  iron 
which  industrial  growth  demanded,  and  the  protection  of 
the  fields  which  were  already  theirs. 

The  situation  of  the  British  steel  manufacturers  was 
equally  precarious,  although  few  of  them  realized  it  until 
long  after  the  Thomas  process  had  been  adopted  abroad. 
At  first  confident  that  the  United  Kingdom's  leadership  in 


154  The  Economic  Causes  of  Modern  War 

the  production  of  steel  by  the  Bessemer  process  would  never 
be  menaced,  they  presently  found  their  rivals  across  the 
North  Sea  developing  the  business  at  a  rate  far  exceeding 
their  own.  Between  1890  and  1910  the  German  steel  busi- 
ness grew  approximately  seven  times  as  rapidly  as  the 
British  in  actual  production.1  The  German  iron-masters 
equalled  the  British  in  1893,  and  at  the  outbreak  of  the  war 
were  producing  about  three  times  as  much  as  their  quondam 
superiors.  Even  in  the  production  of  pig  iron,  where  the 
Thomas  process  gave  no  advantage,  the  production  equalled 
the  British  in  1903,  and  was  double  its  volume  in  1912. 
The  Germans  had  regained  the  supremacy  in  iron  which 
they  had  enjoyed  before  the  Thirty  Years'  War.  The  situa- 
tion was  almost  as  galling  to  the  British  manufacturers  as 
it  was  to  the  French. 

The  Morocco  question,  which  repeatedly  led  Europe  to 
the  verge  of  war,  was  partly  a  result  of  the  Franco-German 
conflict  over  iron.  Moroccan  exports  are  mainly  agricul- 
tural ;  but  the  German  iron-masters,  facing  a  probable  short- 
age of  ore  in  the  very  near  future  and  casting  about  the 
world  for  deposits  from  which  to  make  up  their  lack, 
coveted  the  mines,  as  yet  unworked,  known  to  exist  in 
that  country.  Besides  the  iron,  there  were  copper,  lead, 
antimony,  silver,  gold,  and  sulphur  deposits  available  for 
the  Power  that  could  secure  to  itself  the  mastery  there. 

Dominance  in  Morocco,  situated  conveniently  on  the 
opposite  littoral  of  the  Mediterranean,  meant  to  France  an 
opportunity  for  building  up  her  colonial  trade  still  further; 
and — in  view  of  her  almost  stationary  population — the 
prospect  of  obtaining  from  the  warlike  tribesmen  of  the 
country,  native  troops  with  which  to  meet  the  German 

1  These  and  the  following  figures  are  taken  from  an  article  by  Pro- 
fessor Hermann  Schumacher  of  the  University  of  Bonn,  "Germany's  In- 
ternational Economic  Position,"  in  Modern  Germany,  p.  105. 


The  World  War:  1914-1918  155 

attack  which  sooner  or  later  had  to  come.  The  deposits 
of  iron  and  the  possibility  of  agricultural  development 
were  as  attractive  to  the  French  as  to  the  Germans.  Moroc- 
co was,  moreover,  the  outlet  for  the  commerce  of  Northern 
Africa  and  the  Sahara. 

Because  its  frontiers  marched  with  those  of  the  other 
French  African  possessions,  and  because  of  the  ready  access 
by  sea  from  France,  it  was  the  next  logical  step  in  the  colo- 
nial policy  of  France.  Great  Britain,  enjoying  the  second 
largest  share  in  the  country's  trade,  had  given  up  her  claim, 
and  had  in  the  agreement  of  1904  tacitly  admitted  the  pros- 
pect of  the  entrance  of  the  French.  A  similar  agreement 
with  Spain  recognized  the  prior  rights  of  France. 

The  German  share  of  Moroccan  commerce  averaged  only 
about  nine  per  cent  of  the  yearly  total.  The  future  pros- 
pects of  the  iron  trade,  to  which  strategic  and  political  con- 
siderations were  added,  were  the  mainsprings  of  the  Em- 
pire's policy.  Morocco  was  peculiarly  desirable  to  an  over- 
populated  country  because  it  was  one  of  the  few  portions 
of  the  earth's  surface  suited  to  habitation  by  white  men, 
and  as  yet  unoccupied.  Strategically,  the  establishment 
of  a  German  protectorate  would  have  been  dangerous  to 
the  French  possessions  in  Algiers  and  to  the  sea  routes  to 
France.  Politically,  it  was  felt  that  the  security  of  the 
German  Empire  required  a  constant  reminder  to  the  rest  of 
Europe  of  the  fact  of  Teutonic  hegemony.  Practically, 
these  considerations  took  the  form  of  constant  thwarting 
of  French  economic  aspirations  in  Morocco. 

Although  the  iron  rivalry  and  the  friction  in  Morocco 
were  the  chief  reasons  for  the  ill-feeling  that  ended  at  last 
in  war,  commercial  relations  on  the  Continent  itself  did  not 
tend  to  lessen  the  tension  in  the  relations  of  the  two  states. 
England,  Belgium,  and  Germany,  by  the  logic  of  geography, 
are  the  principal  customers  of  France.     Even  when  the 


156  The  Economic  Causes  of  Modern  War 

French  dependence  on  the  Westphalian  coal  deposits  is  set 
aside,  the  commercial  relations  existing  between  the  two 
chief  political  rivals  of  Europe  were  necessarily  close. 

It  was  not  a  comfortable  situation.  There  were  large 
numbers  of  the  smaller  French  manufacturers  whose  sales 
did  not  extend  beyond  the  limits  of  the  republic ;  and  these 
men,  knowing  that  their  own  trade  could  not  be  injured, 
and  finding  themselves  hampered  by  the  German  importa- 
tion, were  ever  ready  to  encourage  agitation  against  the 
purchase  of  German  goods.  In  many  sections  of  the  press 
and  in  certain  governmental  circles,  they  found  ready 
encouragement. 

In  France  as  in  England,  as  the  growth  of  German  in- 
dustry continued,  Germany's  capacity  for  turning  out 
articles  which  were  serviceable,  if  not  perfectly  made,  and 
for  selling  them  at  low  price,  gravely  affected  domestic 
merchants.  The  same  device  to  counteract  this  was  adopted 
as  in  England.  Imported  goods  were  stamped  with  the 
name  of  the  country  of  their  origin,  a  measure  which  did 
not  in  the  least  serve  to  restrict  the  spread  of  the  German 
goods,  and  may  even  have  been  useful  as  an  advertisement. 
When  the  French  sought  to  boycott  German  products, 
they  found  the  same  device  being  employed  against  them- 
selves across  the  Rhine. 

After  the  Agadir  crisis  there  was  another  effort  in  France 
to  check  the  progress  of  German  economic  infiltration.  As 
a  result,  French  sales  in  Germany  remained  almost  sta- 
tionary, while  German  sales  in  France  climbed  steadily. 
The  failure  of  this  attempt  is  evident  in  the  statistics  which 
show  Germany  and  France  nearly  even  in  their  mutual 
exports  and  imports  in  the  year  before  the  crisis,  and  Ger- 
many climbing  rapidly  ahead  in  the  years  afterward.  The 
French  had  barely  abandoned  their  futile  policy  of  commer- 


The  World  War:  1914-1918  157 

cial  hostility  when  the  World  War  burst  upon  them.  Re- 
duced to  tabular  form,  the  sales  of  the  two  countries  for 
the  years  1910,  1911,  and  1912  stand  as  follows:  x 

France  to  Germany  Germany  to  France 

1910    804,000,000  francs  860,000,000  francs 

1911    819,000,000  965,000,000 

1912    814,000,000  981,000,000 

German  tariffs  were  cleverly  devised  to  close  the  frontier 
against  the  importation  of  many  articles.  By  analyses  of 
wines,  demanded  under  conditions  which,  by  indirect  means, 
made  importation  to  Germany  difficult,  and  by  similar 
devices  of  the  same  sort,  the  Germans  contrived  to  throw  a 
network  of  hindrances  around  French  business,  while  at 
the  same  time  finding  it  possible  to  keep  their  own  goods 
flowing  into  France.  Efforts  by  the  French  to  retaliate  in 
kind  were  not  successful;  and  in  most  cases  the  conflict  hurt 
their  commerce  rather  than  that  of  the  Germans'.  Part 
of  the  French  difficulty  was  undoubtedly  due  to  the  poor 
organization  of  their  commercial  service  in  foreign  coun- 
tries. In  Germany  this  was  organized  in  a  single  bureau 
in  the  Foreign  Office,  while  in  France  it  was  parcelled  out 
among  the  Ministries  of  Finance,  Commerce,  and  Foreign 
Affairs. 

Such  was  the  motivation  of  the  series  of  crises  which  led 
nearer  and  nearer  to  war  at  Tangier  in  1905,  after  the  Alge- 
ciras  Conference  in  1906,  at  Casablanca  in  1908,  and  at 
Agadir  in  1911.  In  each  case  the  fundamental  issues  were 
economic,  in  each  case  only  a  spark  was  needed  to  create 
a  world  war,  yet  not  until  1914  did  the  final  impetus  come, 
though  all  had  been  prepared  by  many  years  of  economic 
hostility. 

1  These  figures  are  adapted  from  M.  Ajam's  book,  Lc  Problcme  Eco- 
nomique  Franco- Allemand,  p.  11. 


158  The  Economic  Causes  of  Modern  War 

THE   "DRANG    NACH    OSTEN" 

One  of  the  most  evident  phenomena  attending  the  Ger- 
man economic  expansion  was  the  Drang  nach  Osten,  or 
trend  toward  the  East,  which  had  come  about  from  nat- 
ural economic  causes  and  had  finally  been  incorporated  into 
the  conscious  policy  of  the  Empire.  It  might  properly  be 
used  to  include  the  economic  penetration  of  Russia  which 
had  been  going  on  for  many  years  when  the  Great  War 
broke  out  in  1914;  for  without  political  action  of  any  sort, 
but  by  a  mere  process  of  infiltration,  the  Germans  had  come 
to  control  a  large  part  of  Russian  industry  and  commerce. 

More  generally,  however,  the  phrase  is  used  to  indicate 
the  German  effort  gradually  to  build  up  at  least  an  eco- 
nomic bloc,  and  if  possible  to  exercise  political  power  at  the 
same  time,  in  the  more  or  less  defined  territory  known  as 
Mittel-Europa.  With  Germany,  and  more  particularly 
Prussia,  as  a  nucleus,  it  was  proposed  to  build  up  an  Em- 
pire which  should  extend  from  the  Baltic  to  the  Persian 
Gulf.  The  Teutonic  blood  of  Austria  was  to  be  included, 
economic  and  political  relations  with  the  Balkan  states  were 
to  be  so  manipulated  as  to  bring  them  under  Teuton  domi- 
nance; the  Turkish  Empire  was  to  receive  the  same  treat- 
ment; and  through  the  agency  of  the  Bagdad  Railway,  all 
of  Asia  Minor  and  the  Tigris-Euphrates  valley  were  to  be- 
come the  domain  of  German  trade. 

The  extremists  believed  that  this  new  and  compact  state 
should  include  among  its  northern  ports,  Amsterdam,  Rot- 
terdam, and  Antwerp, — geographical  and  economic  parts  of 
the  German  Empire,  whose  political  separation  was  an  ac- 
cident against  which  Germany  became  increasingly  restive 
as  her  commerce  grew.  Salonika  and  Trieste  were  looked 
upon  as  potential  German  ports  to  the  south. 

With  a  population  of  more  than  80,000,000  and  with  im- 


The  World  War:  1914-1918  159 

mensely  strengthened  frontiers,  with  an  internal  market 
nearly  as  large  as  that  of  the  United  States,  and  with  an 
impetus  to  industry  which  would  result  from  the  immense 
enlargement  of  the  Zollverein,  the  German  Empire  would  be 
strengthened  to  such  a  point  that  she  could  defy  the  whole 
world,  whether  in  armed  or  economic  warfare. 

The  importance  attached  to  the  Tigris-Euphrates  valley 
was  agricultural.  Here  was  the  home  of  the  earliest  civi- 
lizations known  to  man.  This  area  had  at  one  time  sup- 
ported a  large  population,  and  preliminary  agricultural 
survey  seemed  to  indicate  that  only  proper  scientific 
administration  would  be  required  to  make  it  do  so  again. 
German  efficiency  was  to  be  used  in  the  building  up  of 
an  irrigation  system  which  would  literally  make  the  desert 
blossom  like  the  rose. 

In  Mittel-Europa's  new  territories  were  to  be  produced 
the  supplies  which  would  solve  the  food  problem  and  the 
raw  materials  problem  of  Germany.  Here  her  settlers 
would  find  the  outlet  denied  them  in  the  unhealthy  German 
colonies,  unsuited  to  white  settlers;  and  here  also  there 
would  open  new  markets  for  German  industry. 

Mittel-Europa  was  to  become  an  economically  self-suf- 
ficing unit.  In  its  southern  and  eastern  extremities  it 
would  have  its  new  and  undeveloped  lands — new  lands  be- 
cause they  were  so  very  old  that  the  traces  of  their  former 
development  had  all  but  disappeared.  At  the  northern  end 
would  be  the  centre  of  governmental  control  and  admin- 
istration, the  industries  which  the  raw  materials  from  the 
east  and  south  would  feed,  and  for  which  they  would  af- 
ford markets;  and  here  also  would  be  the  denser  indus- 
trial centres  of  population  in  the  hoped-for  state. 

In  the  Ukraine  the  new  state  would  find  additional  iron 
ore,  wheat,  hemp,  and  the  raw  materials  for  textiles.  Of  im- 
mense importance  were  the  large  deposits  of  manganese, 


160  The  Economic  Causes  of  Modern  War 

a  rare  metal  almost  wholly  lacking  in  Germany,  necessary 
to  the  development  of  an  independent  steel  industry,  of 
which  the  Empire  had  been  importing  500,000  tons  a  year 
before  the  war.  From  the  Caucasus,  which  was  to  be 
joined  to  Turkey,  would  come  more  manganese  and  copper, 
and  from  its  famous  wells  the  oil  that  is  all-important  to 
modern  industry  and  to  modern  navies.  Raw  cotton  also 
was  to  be  had  here,  and  the  territory  offered  an  opportunity 
for  economic  penetration  of  Central  Asia. 

The  possession  of  the  Baltic  provinces  and  of  Poland 
would  add  political  domination  to  economic  penetration  al- 
ready effected,  and  would  also  assure  the  supply  of  flax, 
a  textile  utilized  by  the  Germans  to  supply  the  wool  and 
cotton  which  they  lack.  At  least  a  measure  of  economic 
control  over  the  Rumanian  grain  and  oil  fields  was  also 
contemplated. 

Since  even  this  would  have  left  the  new  Teutonic  Em- 
pire at  a  loss  for  such  products  as  rubber  and  vegetable 
fats,  a  measure  of  tropical  expansion — possible  in  the  mod- 
ern world  only  at  the  expense  of  other  colonizing  nations 
— must  have  been  contemplated. 

The  development  and  extension  of  the  Bagdad  Railway 
would  link  Berlin,  Byzantium  (Constantinople  called  by 
its  old  name  for  the  sake  of  the  alliteration)  and  Bagdad, 
so  that  the  whole  new  Empire  would  be  closely  bound 
together  by  rapid  transport.  Outlets  to  the  sea  would  not 
be  lacking,  in  the  Baltic  and  the  North  Sea,  in  the  Mediter- 
ranean, and  far  to  the  south  in  the  Persian  Gulf.  Com- 
merce with  the  north,  east,  south,  west,  to  all  the  ends  of 
the  earth,  would  be  open. 

Intimately  linked  with  this  whole  scheme,  and  so  es- 
sential to  it  that  one  cannot  be  discussed  without  the  other, 
was  the  Bagdad  Railway,  or  the  "BBB"  as  it  came  to  be 
called  from  the  three  cities  which  it  was  to  link. 


The  World  War:  1914-1918  161 

THE    BAGDAD    RAILWAY 

The  history  of  the  Bagdad  Railway  may  be  dated  from 
the  year  1888,  when  a  concession  was  granted  by  the  Sul- 
tan's government  to  the  Societe  du  Chemin  de  Fer  Ottoman 
d'Anatolie,  a  syndicate  of  Germans,  for  the  construction  of 
a  railway  line  from  Haidar  Pasha  to  Angora,  a  total  dis- 
tance of  576  kilometres  (about  360  miles).  At  the  same 
time  a  short  railway  line  which  had  been  built  a  few  years 
before  to  give  the  Sultan  readier  access  to  his  shooting 
box,  was  taken  over  by  the  company  and  made  a  part  of 
the  new  line,  which  was  under  construction  between  1889 
and  1893,  when  it  was  finally  completed.  No  sooner  had 
this  been  accomplished  than  a  further  concession  was  made, 
permitting  the  extension  of  the  line  as  far  south  as  Konia. 
Work  on  this  section  was  completed  in  1896. 

By  this  time  the  internationally  important  possibilities 
of  the  new  line  (which  appears  in  the  beginning  to  have 
been  a  mere  commercial  venture  without  international  sig- 
nificance) were  beginning  to  be  apparent  in  Europe.     In 
1898  the  Kaiser  paid  a  visit  to  the  Sultan,  which  bore  fruit 
in  the  following  year  when  announcement  was  made  of  a 
concession  for  the  extension  of  the  new  railway  clear  across 
Asia  Minor  with  a  terminus  at  the  head  of  the  Persian 
Gulf.    In  the  same  year  Great  Britain  quietly  established 
a  protectorate  over  Koweit,  a  tiny  principality  under  the 
partial  suzerainty  of  the  Sultan,  which  offered  the  most 
logical  terminus  for  the  railway.     In  1902,  three  years  after 
the  railway  scheme  had  been  officially  announced  by  the 
German  company,  the  Sultan  gave  his  final  approval.     In 
the  following  year,  German  tentative  offers  were  made  to 
the  French  and  the  English  for  their  participation  in  the 
construction  of  the  railway,  the  offer  being  intended  to 


162  The  Economic  Causes  of  Modern  War 

show  that  the  building  of  the  road  had  no  sinister  economic 
significance.  Although  both  the  English  and  the  French 
Governments  had  at  one  time  or  another  taken  a  friendly- 
attitude  toward  the  project  and  had  been  on  the  point  of 
entering  into  it,  the  popular  protests  or  those  of  financiers 
who  perceived  the  danger  to  India  and  the  colonial  pos- 
sessions menaced  by  the  railroad,  had  in  every  case  been 
too  strong.  So  bitter,  indeed,  was  the  feeling  in  France 
that  the  stock  of  the  corporation  was  not  admitted  to 
sale  in  the  Paris  Bourse,  although  very  considerable  French 
investments  in  the  company  were  made  some  years  later. 

Their  offers  having  been  refused,  the  German  company 
began  the  construction  of  the  new  line  alone,  and  in  1904 
track  was  laid  to  Burgulu  in  the  Taurus  Mountains  and 
the  task  of  tunnelling  through  them  was  begun.  Having 
gone  thus  far,  the  Germans  suspended  work  for  a  period 
of  five  years,  resuming  their  construction  in  1909.  Two 
years  later,  the  British,  regretting  their  precipitancy  in 
neglecting  the  German  offer  of  participation  in  the  build- 
ing of  the  road,  made  a  settlement  whereby  they  were  to 
construct  the  connecting  line  from  Bassorah  to  the  Per- 
sian Gulf.  As  the  result  of  a  visit  of  the  Tsar  to  Potsdam 
in  December,  1910,  Russia  in  the  following  summer  with- 
drew her  opposition  to  the  railway,  indicated  her  willing- 
ness to  build  connecting  lines  in  Persia,  and  later  turned 
over  her  reservations  for  construction  in  northern  Asia 
Minor  to  a  group  of  French  financiers.  In  1912  German 
lines  were  laid  eastward  from  Aleppo  and  reached  as  far 
as  the  Euphrates  valley,  and  in  1914  a  line  was  laid  east- 
ward from  Bagdad. 

The  railway  had  gradually  become  a  part  of  the  Ger- 
man Drang  nach  Osten,  although  it  is  almost  certain  that 
when  originally  begun  it  was  what  it  professed  to  be,  a 


The  World  War:  1914-1918  163 

commercial  scheme,  pure  and  simple.1  It  is  evident,  how- 
ever, that  the  possible  economic  and  political  importance 
of  this  line  had  come  to  be  realized  by  the  Foreign  Office 
at  Berlin,  and  that  the  government  stepped  in  behind  the 
financiers.  In  no  other  way  can  the  part  which  the  Kaiser 
played  in  1898  be  interpreted. 

The  completion  of  the  railroad  as  proposed  would  be 
of  the  very  greatest  importance  to  Germany.  Financed  by 
German  business  men  and  built  by  German  engineers,  it 
would  mean  extremely  large  orders  for  supplies,  placed 
with  German  firms,  and  a  correspondingly  large  boom  in 
German  industry.  The  proposed  line  was  to  be  some- 
thing over  1,700  miles  long,  and  was  to  throw  out  impor- 
tant branch  lines  to  Smyrna,  Alexandretta,  Aleppo,  Damas- 
cus, and  Mecca,  thus  binding  Asia  Minor  solidly  into  one, 
and  doing  the  binding  with  German  bonds.  Although  no 
formal  sphere  of  German  influence  had  been  set  up,  it  was 
evident  that  the  completion  of  the  road  could  not  fail  to 
have  this  effect. 

The  German  business  men  who  were  building  the  line 
were  protected  against  loss  by  an  agreement  with  the 
Turkish  Government,  which  guaranteed  4,500  francs  per 
kilometre  for  the  construction  of  the  line,  an  arrangement 
under  which  they  profited  handsomely,  selling  their  priv- 
ileges to  a  subsidiary  company  for  3,200  francs  and  retain- 
ing the  difference.  It  was  realized  from  the  very  begin- 
ning (in  England  with  much  disquietude)  that  the  coun- 

1  Baron  von  Hertling  even  declared  that  the  main  motive  of  the  Ger- 
mans was  interest  in  archeology!  On  April  30,  1907,  he  said:  "It  is  true 
that  a  German  corporation  obtained  the  concession  for  this  railway  from 
the  Ottoman  Government  in  1904,  and  we  have  every  inducement  to  use 
German  capital  in  opening  up  that  old  centre  of  civilization  for  the 
purposes  of  science  and  exploration,  but  that  political  considerations  are 
involved  would  never  occur  to  me."  W.  H.  Dawson,  Evolution  of  Mod- 
ern Germany,  p.  346. 


164  The  Economic  Causes  of  Modern  War 

try  could  not  afford  a  traffic  heavy  enough  in  the  begin- 
ning to  pay  the  cost  of  the  management  nor  the  very  con- 
siderable guarantees  of  operating  expenses  which  the  Turks 
had  made;  but  it  was  certain  to  stimulate  trade  and  to 
facilitate  the  movement  of  the  population  to  the  interior 
of  Asia  Minor. 

To  Germany  it  meant  a  solid  steel  band  of  German  in- 
fluence from  Constantinople  to  Bagdad,  and  eventually, 
from  Berlin  to  Bagdad.  If  the  scheme  of  Mittel-Europa 
became  a  reality,  the  "BBB"  of  which  the  Germans  talked 
so  boastfully  in  the  cafes  would  be  realized.  Germany  was 
to  be  dominant  economically  and  politically  in  an  enor- 
mously rich  region  which  was  in  the  end  to  solve  many  of 
the  pressing  problems  at  home  with  one  stroke.  Over- 
population, the  need  for  markets,  food,  and  raw  materials, 
— they  would  all  be  taken  care  of.  The  carrying  trade  of 
the  road  might  well  include,  also,  a  portion  of  the  trade  to 
India,  which  might  be  diverted  from  the  slower  water  route 
through  the  Suez  Canal  to  the  fast  overland  railway  service. 

The  Bagdad  Railway,  which  has  been  called  the  most 
important  single  cause  of  the  Great  War,  is  the  creation 
of  geography.  From  Haidar-Pasha  on  the  coast  of  Asia 
Minor  opposite  Constantinople,  south  through  the  Taurus 
Mountains,  east  to  Moussoul,  and  thence  south  down  the 
Tigris  to  Bagdad,  it  follows  a  route  that  gives  the  power 
that  holds  it  the  possession  of  all  Asia  Minor.  To  hold  this 
small  western  extremity  of  Asia  has  always  been  of  the 
highest  strategic  importance,  since  from  it  attack  can  be 
launched  speedily  and  successfully  at  any  time,  either  to 
eastward  or  to  westward.  To  control  Asia  Minor  is  to 
command  Egypt,  Syria,  and  Palestine  on  one  side,  and  all 
of  the  potentially  fertile  Tigris-Euphrates  valley  and  the 
open  sea  route  to  India  on  the  other. 

The  earliest  records  of  the  race  show  Asia  Minor  play- 


The  World  War:  1914-1918  165 

ing  this  role  of  the  decisive  Hinterland,  the  actual  key  to 
the  more  fertile  and  important  lands  that  border  it  on 
either  side.  As  early  as  1900  B.  C,  Hittite  warriors  from 
the  rugged  lands  of  Asia  Minor  were  menacing  Assyria, 
Babylonia,  and  Egypt.  The  conquerors  of  the  ancient 
world,  marching  to  their  victories,  passed  by  the  route  which 
centuries  later  modern  engineers  were  to  lay  out  for  the 
Bagdad  Railway.  To  Alexander  the  Great  this  route 
opened  the  way  for  the  conquest  of  India.  The  first  bat- 
tles of  the  Crusaders  were  fought  in  the  heart  of  Asia 
Minor — Nicea,  Antioch,  and  only  after  that  Jerusalem. 
Then  as  now,  the  all-important  Hinterland  dominated  com- 
pletely the  regions  lying  along  its  borders. 

It  was  because  of  this  domination  that  Great  Britain 
objected  to  the  building  of  the  proposed  road,  one  terminus 
of  which  would  be  within  twelve  hours  of  Egypt  and  the 
other  only  four  days'  voyage  from  Bombay.  The  building 
of  the  railway  would  yield  German  industry  profit  from 
the  supply  of  material;  and  the  gradual  opening  up  of 
the  country  to  the  commerce  of  the  Empire  would  keep 
the  German  power  perpetually  at  the  doors  of  the  two 
most  important  British  dependencies.  The  safeguarding 
of  the  route  to  India — a  consideration  of  the  highest  eco- 
nomic importance,  largely  dominant  in  the  foreign  policy 
of  Great  Britain  for  a  full  century — was  again  uppermost. 

The  adroitness  with  which  the  British  had  secured  a  pro- 
tectorate over  Koweit,  with  deep  harbors  and  excellent 
docking  facilities,  the  most  available  of  the  two  possible 
termini  for  the  road  at  the  head  of  the  Persian  Gulf,  had 
in  some  measure  offset  this  danger.  The  Germans  would 
now  be  forced  to  establish  themselves  at  Fao,  the  one  re- 
maining town,  if  they  were  to  reach  the  Gulf  at  all,  and 
the  new  British  protectorate  would  serve  admirably  at 
any  time  as  the  basis  for  naval  action  against  them. 


166  The  Economic  Causes  of  Modern  War 

The  Germans  never  reached  the  Persian  Gulf.  Imme- 
diately before  the  outbreak  of  the  World  War,  an  agree- 
ment was  made  whereby  Germany  was  to  have  economic 
and  financial  control  of  the  railroad  only  as  far  south  as 
Bagdad ;  the  line  south  to  Bassona  was  to  be  international ; 
and  Great  Britain  was  to  control  the  road  thence  to  the 
Persian  Gulf.  With  the  outbreak  of  the  war,  all  the  years 
of  effort  came  to  nothing. 

These  semi-political  and  semi-economic  causes  for  the 
British  objections  to  the  building  of  the  railroad  do  not 
exhaust  the  purely  economic  objections  which  existed  quite 
apart  from  the  tacit  threats  to  Egypt,  the  Suez  Canal,  and 
India.  In  several  directions  the  completion  of  the  road 
would  be  a  blow  at  British  business  interests  which  the 
British  Government  was  resolved  to  prevent  if  possible. 

The  guarantees  which  the  Turkish  Government  had  made 
to  the  entrepreneurs  of  the  new  railroad  were  obviously  too 
liberal,  in  view  of  its  probable  earning  capacity  for  years 
to  come.  It  was  clear  that  the  finances  of  the  Turkish 
Government  would  be  subjected  to  a  severe  strain  to  meet 
the  kilometric  guarantee,  and  that  in  order  to  do  this  the 
taxation  would  have  to  be  increased.  A  part  of  the  bur- 
den was  certain  to  fall  upon  British  commerce,  which  was 
very  extensive  in  Turkey,  and  which,  being — as  the  Brit- 
ish alleged — better  made  and  certainly  more  expensive  than 
the  competing  German  commodities,  would  be  less  capable 
of  maintaining  the  foothold  already  won.  The  trade  mark 
"Made  in  Germany"  was  already  pushing  the  British  prod- 
ucts hard  enough  in  other  parts  of  the  world.  If  the  Bag- 
dad Railway  was  to  increase  the  severity  of  German  com- 
petition, the  British  public  would  have  none  of  it. 

If,  too,  the  kilometric  guarantee  were  to  increase  fur- 
ther the  difficulties  and  confusion  of  Turkish  finance,  Brit- 
ish investors,  who  held  considerable  interests  in  these  re- 


The  World  War:  1914-1918  167 

gions,  had  reason  enough  to  desire  to  see  the  building  of 
the  road  checked. 

There  was  still  another  reason  for  the  British  objections 
to  the  completion  of  the  line.  Britain,  as  a  maritime  power, 
had  for  years  held  the  monopoly  of  the  carrying  and  pas- 
senger trade  of  the  world  afloat.  In  late  years  the  develop- 
ment of  the  German  maritime  power  had  threatened  this. 
Now  the  prospect  of  a  partial  diversion  of  travel  from  the 
British  merchant  fleet  plying  through  the  Suez  Canal  to 
India  and  the  East  was  a  further  blow,  alike  intolerable  to 
the  pride  and  the  pocket-book  of  the  British. 

Economic  considerations  were  equally  powerful  in  preju- 
dicing the  French  against  the  railway,  even  though  the 
company  had  in  1902  offered  to  assign  to  French  capitalists 
40  per  cent,  of  stock,  the  same  amount  that  had  been  re- 
served for  the  Germans.  The  Bagdad  Railway  was  a  Ger- 
man undertaking  and  the  power  for  its  management  was 
certain  to  be  retained  in  German  hands.  It  would  inevit- 
ably end  in  the  establishment  of  German  economic  domina- 
tion in  the  region  which  it  traversed.  The  French  had  an 
economic  domination  of  their  own  along  the  Mediterranean 
coast  of  Asia  Minor  from  Smyrna  to  Beirut.  For  a  time 
they  might  be  able  to  hold  their  own,  because  of  their  direct 
access  by  waterways  to  this  district,  but  in  the  end  it  was 
realized  that  the  German  control  of  the  all-important 
territory  covered  by  the  railway,  would  seriously  threaten 
this  influence  if  it  did  not  annihilate  it  entirely. 

The  equable  partition  between  Germany  and  France  of 
the  trade  of  Turkey  was  a  hopelessly  Utopian  proposal,  for 
there  was  no  doubt  as  to  the  increasing  importance  of  Ger- 
many, not  only  in  Constantinople  but  throughout  Asia 
Minor.  The  importance  of  maintaining  French  prestige  in 
the  Orient  was  itself  a  commercial  necessity,  for  out  of  it 
an  increase  of  commerce  was  to  grow. 


168  The  Economic  Causes  of  Modern  War 

For  centuries  the  French  had  held  their  own  in  this  re- 
gion, and  had  even  built  railways  from  the  coast  for  short 
distances  into  the  interior,  notably  the  Smyrna-Kassaba 
line,  which  came  under  French  influence  in  1893,  the  Mer- 
sina-Adana  line,  in  which  there  were  large  French  holdings, 
the  line  from  Jaffa  to  Jerusalem,  which  was  exclusively 
French  and  was  built  in  1892,  the  Beirut-Damascus  line 
(later  extended  north  and  south  until  it  totalled  361  miles) 
completed  in  1910. 

Railways  projected  by  the  French  would  have  built  up 
a  complete  system  touching  the  holy  cities  and  reaching 
the  profitable  passenger  traffic  of  pious  Moslems  who  are 
quick  at  catching  at  western  means  of  shortening  the  pil- 
grimage to  Mecca,  which  every  good  Mohammedan  makes 
at  least  once  in  his  life.  The  French  roads  would  have  in- 
cluded 1,000  miles  of  rail,  and  would  have  been  almost  as 
ambitious  as  the  German  project.  They  had  been  designed 
to  spread  French  economic  influence  and  to  promote  the 
fortunes  of  French  commercial  houses;  but  the  comple- 
tion of  the  Bagdad  road  would  necessarily  lead  to  their 
absorption  and  Germanization. 

In  ways  even  more  direct,  French  prosperity  would  be* 
affected.  A  great  deal  of  the  English  travel  to  India  went 
by  way  of  Marseilles  instead  of  taking  ship  at  Liverpool. 
This  meant  that  the  travelers  passed  through  most  of 
France  on  their  way  and  this  constant  stream  enriched  the 
French  railways,  hotels,  and  merchants  by  sums  which  were, 
taken  in  aggregate,  very  considerable.  But  if  the  Bag- 
dad Railway  became  a  reality  and  evolved  into  the  pro- 
posed Berlin-to-Bagdad  route,  a  large  part  of  this  travel 
would  be  lost  to  France,  for  the  tourists  would  then  take 
the  more  direct  route  by  way  of  Ostend,  Cologne,  Munich, 
and  Vienna.  The  profits  which  the  thrifty  French  were 
accumulating  would  go  to  the  hated  Germans. 


The  World  War:  1914-1918  169 

In  Russia  there  were  the  gravest  possible  military  rea- 
sons why  the  Bagdad  Railway  should  not  be  built.  As 
matters  stood,  Russia  was  in  control  of  the  theatre  of  a 
possible  war  against  the  Turks.  War  vessels  of  the  Black 
Sea  fleet  could  leave  either  Sebastopol  or  Odessa  as  a  base, 
and  could  appear  before  the  defenses  of  Constantinople 
within  thirty  or  forty  hours'  hard  steaming.  In  the  event 
of  war,  Russian  attack  by  land  could  be  directed  against 
Erzerum,  Sivas,  and  Angora,  and  although  this  would  in- 
volve fairly  long  marches,  the  difficulties  of  transport  in 
the  way  of  Turkish  mobilization  were  such  that  the  Slavic 
armies  could  reach  these  strategic  points  in  force  before 
the  Turks  could  concentrate.  The  Bagdad  Railway,  es- 
pecially if  run  via  the  northern  route  at  first  proposed  and 
then  abandoned  by  reason  of  Russian  protests,  would 
change  all  this  and  would  make  it  possible  for  Turkish 
forces  to  be  concentrated  with  much  more  rapidity  than 
before.  The  value  of  Asia  Minor  as  a  reservoir  of  mili- 
tary strength  for  the  Sultan  had  hitherto  been  impaired 
because  of  the  difficulties  involved  in  transport.  In  the 
Russo-Turkish  War  in  1877  the  Turkish  6th  Army  Corps 
reached  the  line  only  after  two  months  of  forced  marches, 
with  great  loss  of  effectives,  and  too  late  to  be  of  use.  Had 
the  Bagdad  road  been  in  existence  at  that  time,  Russia 
might  have  lost  the  war. 

The  new  road  struck  also  at  Russian  economic  interests, 
especially  in  view  of  the  project  for  the  construction  of 
a  branch  of  the  great  Trans-Siberian  Railway  into  the  Cau- 
casus. Great  quantities  of  traffic  would  certainly  be  di- 
verted from  the  proposed  Russian  railroad.  As  in  the  case 
of  all  the  other  Powers,  the  increased  German  dominance 
certain  to  result  from  the  economic  penetration  of  Turkey 
and  Asia  Minor  would  serve  to  check  what  progress  Rus- 
sia had  already  made  and  to  forbid  all  hopes  for  the  future. 


170  The  Economic  Causes  of  Modern  War 

Even  the  allies  of  Germany  were  fearful  of  the  Bagdad 
scheme,  which  meant  in  the  end  German  predominance 
throughout  the  Balkans.  Since  the  trend  of  Austrian  eco- 
nomic development  was  southward,  the  government  looked 
without  favor  on  undue  extension  of  German  economic  in- 
fluence through  the  very  lands  where  its  own  ambitions 
lay.  Italy,  likewise,  though  not  directly  affected,  had  had 
enough  experience  with  the  Salonika-Monastir  line,  Ger- 
man-controlled throughout,  and  with  German  methods  of 
economic  penetration  as  demonstrated  in  the  Banca  Nazi- 
onale,  which  though  Italian-owned  was  German-controlled, 
to  be  fearful  both  of  too  great  German  preponderance  and 
of  interference  with  Italian  ambitions  in  Albania  and  es- 
pecially as  regarded  Salonika. 

In  this  way  it  came  about,  through  the  mutual  eco- 
nomic rivalry,  greed,  and  distrust  of  the  Great  Powers  and 
of  the  merchants  who  are  their  citizens,  that  the  Bagdad 
Railway,  in  itself  a  great  commercial  enterprise  with  tre- 
mendous capacities  for  usefulness,  was  the  bane  of 
Europe  for  nearly  twenty  years.  It  is  another  illustration 
of  the  working  of  economic  pressure  in  international  rela- 
tions and  the  importance  of  economic  highways.  The  route 
which  the  railway  followed  was  the  key  to  the  East  which 
all  the  Powers  coveted. 

AUSTRIAN   AND    ITALIAN   ECONOMIC    AMBITIONS 

The  economic  relations  of  Austria  before  the  World  War 
were  closest  with  Hungary,  her  partner  state  in  the  Dual 
Monarchy,  and  with  her  ally,  the  German  Empire.  Al- 
though points  of  conflict  between  the  German  and  Aus- 
trian economic  policies  existed,  economic  partnership  had 
in  the  main  been  added  to  political  alliance, — an  arrange- 


The  World  War:  1914-1918  171 

ment  without  which  the  Mittel-Europa  scheme  would  have 
been  impossible. 

Austria  and  Hungary,  the  two  members  of  the  Dual 
Monarchy,  are  mutually  complementary  economic  units, 
Hungary  being  chiefly  an  agricultural  and  Austria  chiefly 
an  industrial  state.  Between  1884  and  1891,  nearly  84  per 
cent,  of  Hungarian  imports  came  from  Austria,  whilst  71 
per  cent,  to  75  per  cent,  of  Hungarian  exports  went  to 
Austria.  In  later  years  even  this  slight  disproportion  van- 
ished, so  that  the  statement  could  be  made  in  November, 
1906,  that  Hungary  exported  nearly  40,000,000  pounds  ster- 
ling of  agricultural  produce  yearly  to  Austria,  and  received 
in  return  almost  the  same  amount  of  manufactured 
products.1 

The  disruption  of  the  Dual  Monarchy  would  be  nothing 
short  of  a  catastrophe  for  Hungary,  which  is  hampered  in 
her  outlook  to  the  sea  and  surrounded  by  other  agricul- 
tural states,  which  have  no  need  for  her  cereals,  cattle,  and 
other  raw  products.  To  a  less  extent,  through  the  loss 
of  markets  and  the  increase  in  the  price  of  agricultural 
products,  Austria  is  equally  bound  to  Hungary  by  eco- 
nomic forces.  Each  is  necessary  to  the  other,  and  each 
suffers  the  same  difficulty  in  gaining  access  to  the  sea. 

No  more  striking  example  than  this  could  be  found  of 
the  importance  of  economics  in  promoting  either  peaceful 
or  hostile  relations  between  states.  In  spite  of  their  racial 
differences  and  the  very  serious  disagreements  that  at  times 
have  arisen,  these  two  dissimilar  states  are  held  together 
by  their  very  dissimilarity,  the  perfection  with  which  each 
is  the  economic  complement  of  the  other.  The  strength  of 
the  economic  bond  in  such  a  case  serves  only  to  empha- 
size the  power  of  economic  rivalry,  when  it  exists,  in  causing 
and  embittering  the  hostilities  of  nations. 

1  Geoffrey  Drage :    Austria-Hungary,  p.  202. 


172  The  Economic  Causes  of  Modern  War 

Like  Germany,  Austria  looked  southward  for  the  future 
development  of  her  markets.  An  industrial  state,  she 
found  in  the  backward  states  of  the  Balkans  lying  at  her 
doors,  the  agricultural,  non-industrial  peoples  whose  prod- 
ucts were  of  use  to  her  and  who  could  buy  her  own  sur- 
plus. To  this  end  was  directed  the  Austrian  policy  of  con- 
tinuous meddling  in  the  Balkans,  for  the  continuance  of 
supremacy  there  was  all-important  to  her  industries. 

Cut  off  as  Austria  was  from  access  to  the  sea,  with  only 
a  few  ports  on  the  Adriatic,  the  Balkans  offered  the  most 
accessible  territory  for  economic  penetration.  The  great 
highway  of  the  Danube  led  to  the  heart  of  their  most  fer- 
tile regions.  In  the  very  nature  of  things,  Austria  could 
not  look  for  a  world-wide  commerce  such  as  that  of  the 
more  fortunate  states  with  more  complete  approach  to  the 
great  highways  of  the  world.  Even  her  efforts  to  secure 
additional  ports  on  the  Dalmatian  coast  (although  they 
might,  had  they  been  successful,  have  lessened  the  friction 
rising  from  her  interference  in  the  Balkans)  brought  her 
inevitably  into  conflict  with  Serbia,  equally  desirous  of  out- 
let in  the  same  territories,  and  with  Italy,  seeking  them  as 
a  base  for  entrance  into  Balkan  markets. 

In  Serbian  trade  the  Austrians  had  won  almost  com- 
plete supremacy  during  the  last  years  of  the  Nineteenth 
and  the  first  years  of  the  Twentieth  Century.  So  com- 
plete was  the  dependence  of  the  Serbs  upon  their  north- 
ern neighbor  that  they  bought  from  her  almost  everything 
from  scientific  instruments  to  packing  cases.  Only  in  their 
purchases  of  war  materiel,  to  the  disgust  of  the  iron-mas- 
ters of  Skoda,  did  they  persist  in  turning  to  France. 

It  was  the  completeness  of  their  economic  mastery  over 
their  smaller  neighbor  that  made  it  desirable  in  Austrian 
eyes  that  the  Serbians  should  remain  cut  off  from  the  sea. 
Quite  aside  from  the  fact  that  they  themselves  coveted  the 


The  World  War:  1914-1918  173 

same  seacoast  for  which  the  Serbians  hoped,  was  the  im- 
portant consideration  that  the  granting  of  a  port  to  Serbia 
would  mean  the  necessity  of  sharing  profits  of  Serbian  trade 
with  the  merchants  of  other  nations,  who  would  then  be 
able  to  come  in  by  sea.  This  trade  monopoly  was  the 
mainspring  of  Austrian  policy  towards  Serbia,  though  it 
was  complicated  by  the  fear  of  irredentism  among  the 
Slavic  subjects  of  the  Empire.  It  explains  the  interference 
after  the  Bulgarian  victory  at  Slivnitsa  in  1885,  the  constant 
balking  of  Serbian  struggles  to  reach  the  sea,  and  the  evi- 
dent desire  to  absorb  the  whole  territory  of  the  little  state 
if  opportunity  offered. 

In  1905  the  monopolists  went  a  step  too  far.  At  that 
time  Austria-Hungary  was  receiving  90  per  cent,  of  the 
Serbian  exports,  mainly  agricultural  products,  cattle,  and 
pigs.  Incensed  at  the  negotiation  of  a  commercial  treaty 
with  Bulgaria  by  which  tariff  duties  between  the  two  states 
were  to  be  abolished,  as  well  as  by  the  continued  Serbian 
orders  from  the  French  arsenal  at  Creusot,  the  Austrian 
Government  refused  to  renew  the  commercial  treaty  which 
was  the  foundation  of  Serbian  foreign  trade.  The  frontier 
remained  closed  for  more  than  two  years.  Serbian  ruin,  of 
which  the  more  powerful  northern  neighbor  was  confi- 
dent, was  averted  by  the  combined  efforts  of  the  Serbian 
Ministry  of  Commerce,  the  Skuptshina  (Parliament),  and 
the  whole  people.  New  outlets  were  found  by  way  of  the 
Danube  and  the  Turkish  railway  to  Salonika.  A  single 
French  business  man  guaranteed  the  purchase  of  150,000 
pigs  a  year.1  France,  Italy,  Belgium,  Germany,  and  Egypt 
began  to  replace  the  Austrian  market.    This  was  the  be- 

1  Yves  Guyot:  Causes  and  Consequences  of  the  War,  p.  19.  There  is 
a  further  discussion  of  this  incident  by  the  same  author,  "La  Question 
d'Orient  et  les  Confiits  Economiques,"  Journal  des  Economistes,  xxxvi: 
178-198,  N.  '12. 


174  The  Economic  Causes  of  Modern  War 

ginning  of  Serbian  economic  independence,  but  it  was  only 
a  beginning;  and  it  added  to  the  Austrian  determination 
to  restore  the  old  dependence. 

Commercial  success  in  the  other  Balkan  states,  though 
not  approaching  the  domination  which  obtained  in  Serbia, 
had  been  very  great.  Although  in  Bulgaria  the  seacoast 
made  it  possible  for  British  commerce  to  dispute  the  field, 
the  Bulgarians  bought  from  Austria  their  iron,  bags,  jew- 
elry, crockery,  and  similar  goods,  as  well  as  agricultural 
machinery  and  war  materiel,  both  important  articles  of 
trade  in  the  Balkans.  Rumania  bought  machinery  and  tex- 
tiles, paying  for  them  with  the  proceeds  of  her  Austrian 
sales  of  such  agricultural  products  as  corn  and  butter.  The 
Montenegrin  trade  alone  failed  to  reach  large  proportions, 
principally  because  the  country  was  too  small  to  make  trade 
profitable. 

Important  though  their  own  commerce  was,  the  Balkans 
were  equally  important  as  the  overland  route  to  Asia  Minor. 
Austrian  policy  was  directed  to  keeping  the  little  Sanjak 
of  Novi-Bazar  in  Turkish  hands  in  order  that  the  "BBB," 
running  all  the  way  through  friendly  territory,  might  open 
the  way  to  increasing  trade.  The  subsequent  Serbian  seiz- 
ure of  this  little  strip  of  land  made  a  future  war  for  its  re- 
covery almost  certain.  Austrian  exports  to  Turkey  and  the 
Near  East  consisted  of  manufactured  goods,  textiles,  glass- 
ware, ready-made  clothes,  fezzes,  sugar,  woollens,  and 
petroleum;  and  the  imports  in  return  were  principally  to- 
bacco, opium,  skins,  and  maize.  The  progress  of  both 
Austrian  and  Hungarian  products  was  so  rapid  that  in  the 
last  years  before  the  Balkan  Wars  their  sugar  began  to 
supplant  that  from  Russia,  and  the  jute  trade,  which  had 
formerly  been  controlled  by  Scotch  and  Indian  merchants, 
was  also  falling  into  their  hands.  The  sales  of  Hungarian 
petroleum  rivalled  those  of  the  Russian  wells.    Thus  Aus- 


The  World  War:  1914-1918  175 

trian  policy  in  the  Balkans  clashed  with  that  of  Russia, 
and  Great  Britain,  although  the  political  motives  of  the 
Slavic  Power  were  of  more  importance  than  the  economic. 

With  Italy,  the  partner  of  Austria  and  Germany  in  the 
Triple  Alliance,  the  clash  of  interests  was  more  evidently 
economic.  The  developing  Italian  industries  looked  across 
the  narrow  Adriatic  to  the  Balkans  for  a  part  of  their  mar- 
kets. It  was  as  a  base  for  economic  penetration  of  the 
agricultural  lands  lying  to  the  east  that  Italy  desired  to 
possess  the  Dalmatian  coast,  not  merely  as  a  site  for  naval 
bases,  which  would  give  supremacy  in  the  Adriatic.  In- 
deed, even  the  desire  to  make  this  sea  an  Italian  lake  was 
as  much  economic  as  strategic  in  its  origin,  for  such  a  con- 
summation would  have  crippled  Austrian  trade  in  the  Bal- 
kans and  the  Near  East,  whilst  giving  a  proportionate  ad- 
vantage to  Italian  trade.  Once  Italy's  power  was  estab- 
lished along  this  important  strip  of  territory,  railways  run- 
ning into  the  heart  of  the  Balkans  would  soon  be  carrying 
the  surplus  products  of  her  industry. 

It  was  for  similar  reasons  that  Italy  desired  Trieste  and 
as  much  of  Kustenland  as  she  could  obtain.  Possession  of 
this  port  would  put  the  Italians  in  a  position  to  dictate  the 
terms  of  their  rival's  exports  in  time  of  peace,  and  to  cut 
them  off  entirely  in  time  of  war.  Possession  of  either  Dal- 
matia  or  Trieste  would  go  far  toward  securing  commercial 
supremacy.  Possession  of  both  by  either  Power  would  put 
the  other  at  its  mercy.  Desire  for  national  union  urged 
the  Italians  on  to  Trieste.  In  both  Dalmatia  and  Trieste 
the  strategic  considerations  were  of  the  highest  importance ; 
but  it  was  economic  motives  that  were  paramount. 

What  has  been  true  of  the  lesser  wars  of  the  Nineteenth 
and  Twentieth  Centuries  may  be  seen  to  be  true  also  of 
this  latest  and  greatest  of  wars.  It  was  rooted  in  economic 
causes.     The   political   rivalries,    the   naval   rivalries,    the 


176  The  Economic  Causes  of  Modern  War 

colonial  rivalries  are  only  the  expression  of  the  underlying 
economic  struggle. 

Through  the  whole  web  and  woof  of  the  diplomacy  which 
leads  up  to  the  final  war,  we  have  the  thread  of  economic 
conflict.  Economic  questions  were  perpetually  under  dis- 
cussion in  the  diplomatic  interchanges  of  the  years  before 
the  war;  and  even  when  the  stakes  at  issue  seem  entirely 
political  or  military,  they  can  usually  be  seen  to  have  an 
economic  origin.  The  statesman  who  seeks  to  extend  the 
boundaries  of  a  colony  to  include  some  especially  valuable 
territory,  the  soldier  who  demands  a  strategic  position  to 
defend  that  colony,  or  the  sailor  who  asks  for  a  naval  base, 
— all  are  seeking,  consciously  or  unconsciously,  the  same 
thing:  relief  from  economic  pressure  by  further  expansion. 


CHAPTER  V 

THE   PREVENTION   OF   WAR  BY   INTERNATIONAL   FINANCE 

Four  things  make  modern  warfare  possible:  man-power, 
armaments,  food,  and  finance.  It  is  obvious  that  without 
men,  arms,  and  food,  no  wars  could  ever  have  been  waged ; 
and  it  is  equally  evident  that  these  three  essentials  can 
be  secured  only  by  the  state  that  can  raise  the  necessary 
money.  For  soldiers,  even  though  they  be  conscripts,  must 
be  paid ;  and  the  food  that  they  eat  and  the  weapons  that 
they  use,  must  be  bought.  In  earlier  days,  because  of  the 
relatively  small  forces  in  the  field  and  their  relatively  un- 
pretentious equipment,  the  cost  of  arms  was  less  and  the 
financial  problem  correspondingly  simple;  but  the  enor- 
mous cost  of  war  on  the  vast  modern  scale  makes  finance 
of  supreme  importance.  Without  money  and  credit,  no 
state  can  go  to  war  today.     So  much,  at  least,  is  clear. 

The  relation  of  finance  to  war  has  never  been  completely 
understood,  and  the  views  upon  the  question  prevailing 
today  are,  in  their  extreme  forms,  widely  contradictory. 
Mr.  Norman  Angell  would  have  us  believe  that  sound  busi- 
ness sense,  on  a  profit-and-loss  basis,  requires  the  aboli- 
tion of  war.  Extremists  on  the  other  side  defend  the  thesis 
that  the  malevolent  power  of  greedy  bankers,  who  see  in 
war  a  chance  for  gain,  stands  behind  the  diplomats  in  every 
outbreak  of  hostilities.  Writers  of  this  school  aver  that 
international  finance  has  become  so  powerful  that  states- 
men are  helpless  to  enter  upon  a  war  in  the  face  of  oppo- 
sition from  the  financiers;  whereas  another  group,  without 
denying  either  the  power  of  international  financiers  or  the 

177 


178  The  Economic  Causes  of  Modern  War 

degree  of  dependence  of  one  state  upon  another  prevailing 
in  the  field  of  international  finance,  assert  that  finan- 
ciers and  statesmen  together  may  drift  helplessly  into  a 
war  which  none  of  them  desire,  but  which  they  are  power- 
less to  avoid. 

In  spite  of  the  contradictory  character  of  these  views,  it 
is  easy  to  see  that  international  finance,  by  virtue  merely 
of  the  enormous  complexity  of  its  inter-relations,  is  of  ne- 
cessity a  stabilizing  influence  in  the  relations  between 
states;  and  that  in  general  its  influence — which  upon  occa- 
sion is  tremendous — is  likely  to  be  used  for  the  preserva- 
tion of  peace,  because  of  the  chaos  to  which  war  on  the 
modern  scale  necessarily  reduces  the  whole  intricate  sys- 
tem. 

The  extent  to  which  the  general  staff  of  a  modern  army 
considers  the  money  market  may  be  seen  in  the  elaborate 
planning  which  has  been  given  to  the  financial  support  of 
the  army  prior  to  most  of  the  modern  wars  of  history. 
Probably  the  best  known  example  is  the  German  reserve 
of  gold  which  was  for  years  hoarded  in  the  Julius  Tower 
at  Spandau,  and  which  is  believed  to  have  been  greatly 
increased  in  the  years  preceding  the  outbreak  of  the  war 
in  1914.  This  immense  gold  reserve,  which  amounted  to 
6,000,000  pounds,  mostly  from  the  French  indemnity  after 
the  War  of  1870,  remained  at  Spandau  until  1913,  when 
it  was  transferred  to  the  Reichsbank  at  Berlin,  and  de- 
posited there  together  with  12,000,000  pounds  in  gold  and 
silver,  to  be  kept  apart  from  the  commercial  reserves  of 
the  bank  and  used  only  in  time  of  war. 

It  is  certain  that  the  German  General  Staff  had  given 
a  great  deal  of  thought  and  study  to  the  financial  aspects 
of  the  Great  War.  War  costs,  war  loans,  and  war  expenses 
had  been  carefully  taken  into  consideration,  as  well  as  the 
probable  effect  of  a  declaration  of  war  upon  the  money 


The  Prevention  of  War  by  International  Finance      179 

market,  at  the  same  time  that  the  problems  usually  con- 
sidered more  strictly  military  were  being  worked  out. 

This  is  by  far  the  most  elaborate  example  of  financial 
preparation  for  war,  but  there  are  numerous  others,  as  well 
as  examples  of  the  disastrous  results  of  failure  to  provide 
financially,  in  time  of  peace,  for  possible  wars. 

Members  of  Lord  Elgin's  Commission  on  the  South 
African  War  expressed  the  opinion  that  if  the  War  Office 
had  had  at  its  disposal  the  sum  of  10,000,000  pounds  a  few 
months  before  the  outbreak  of  hostilities,  to  be  spent  with 
the  consent  of  the  Cabinet  as  the  only  necessary  sanction 
(thus  avoiding  the  publicity  attendant  upon  Parliamentary 
action)  the  preparations  that  could  then  have  been  made 
would  have  cut  down  the  cost  of  the  war  by  100,000,000 
pounds,  and  might  have  prevented  hostilities  entirely.  As 
is  well  known,  the  declaration  of  war,  when  it  did  come, 
found  the  British  hopelessly  unprepared  in  South  Africa  and 
with  a  miserably  inadequate  force  ready  to  take  the  field. 

The  painstaking  quality  of  the  long  preparation  of  the 
Japanese  for  their  war  upon  Russia  in  1904-1905,  was  shown 
in  nothing  more  characteristically  than  in  the  thought  and 
foresight  that  they  expended  in  their  financial  plans  for 
the  struggle.  The  war  between  Russia  and  Japan  was  de- 
termined by  economic  and  financial  considerations  at  every 
step.  It  is  well  known  that  in  spite  of  her  military  and 
naval  successes  Japan  must  have  succumbed  to  Russia  in 
the  end  for  lack  of  funds,  had  not  the  disorganized  con- 
dition of  the  larger  state  forced  her  to  sue  for  peace  while 
the  troops  of  the  Mikado  were  still  victorious.  Largely 
because  the  Russian  treasury  was  still  unexhausted,  whereas 
the  Japanese  knew  their  own  financial  shortage,  and  be- 
cause the  English  bankers  gave  signs  of  being  unwilling  to 
make  further  loans,  the  victor's  plan  of  making  the  enemy 
pay  by  indemnity  for  the  cost  of  his  defeat  had  to  be  aban- 


180  The  Economic  Causes  of  Modern  War 

doned.  For  financial  reasons,  Japan  did  not  wish  to  con- 
tinue the  struggle. 

Long  before  the  negotiations  with  Russia  which  preceded 
hostilities  had  reached  a  critical  stage,  the  Japanese  De- 
partment of  Finance  had  elaborated  its  program.  At  the 
commencement  of  the  war  the  Bank  of  Tokio  held  a  total 
of  11,696,000  pounds,  as  compared  with  105,000,000  pounds 
held  by  the  Bank  of  Russia  and  the  Imperial  Treasury- 
combined.  Although  the  cost  of  the  war  to  the  Japanese 
was  200,000,000  pounds,  the  Bank  of  Japan  still  retained 
almost  the  same  reserve  as  at  the  beginning  of  the  war, 
10,444,000  pounds,  a  decrease  of  only  a  little  more  than  a 
million  after  more  than  a  year  of  war  against  a  larger  and 
incomparably  a  richer  foe.  During  the  latter  part  of  May, 
1904,  a  temporary  diminution  occurred  and  the  reserve 
reached  6,800,000  pounds;  but  the  government,  while  mak- 
ing every  effort  to  withdraw  as  little  gold  as  possible  from 
London,  kept  the  reserve  of  their  own  bank  replenished 
constantly,  and  made  every  effort  to  prevent  any  possible 
depression  of  the  money  market.1 

Although  the  Russian  preparation  for  the  war  had  been 
characterized  by  none  of  the  foresight  of  the  Japanese,  the 
value  of  a  large  gold  reserve  in  time  of  war  was  completely 
demonstrated.  Because  of  the  millions  of  gold  which  they 
held,  the  Russians  were  able  to  borrow  as  cheaply  in  France 
and  Germany  as  the  Japanese  were  able  to  borrow  in  Eng- 
land. It  was  the  incompetency  of  the  military  and  naval 
service  and  the  disorganization  within  the  government  and 
among  the  people  which  defeated  Russia,  It  is  probable 
that  had  the  war  continued,  the  advantages  of  the  larger 
reserve  would  have  been  more  and  more  convincingly  dem- 
onstrated. 

1  These  figures  are  derived  from  an  article  by  Edgar  Crammond: 
"Financial  Preparation  for  War,"  Nineteenth  Century:  74:929:   N.,  '13. 


The  Prevention  of  War  by  International  Finance      181 

The  importance  of  finance  to  military  leaders  results  from 
the  necessity  of  borrowing  huge  sums  for  any  considerable 
war  because  of  the  tremendous  costs  of  modern  armaments. 
In  the  last  years  of  the  Great  War  the  expenditures  of  the 
Allied  Powers  were  so  enormous  that  their  own  financial  re- 
serves were  exhausted;  and  they  were  forced  to  turn  first 
to  Great  Britain  and  then,  when  even  the  resources  of  Lon- 
don, the  financial  capital  of  the  world,  began  to  fail,  to 
the  United  States,  especially  after  her  entrance  made  Amer- 
ican resources  available.  In  similar  fashion,  the  Central 
Powers  were  forced  to  turn  to  Germany.  The  vastness  of 
modern  war  expenditures,  and  the  extent  to  which  the  richer 
nations  were  compelled  to  assist  their  allies,  may  be  seen 
in  the  following  table:  l 

Gross   Costs  Among   Active   Belligerents 

Gross            Advances  to  Allies  Net.  Cost 

United  States $32,080,266,968  $9,455,014,125  $22,625,252,843 

Great   Britain    44,029,011.868  8,695,000,000  35,334,000,000 

Rest  of  Empire    ...       4,493,813,072  ***  4,493,813,072 

France    25,812,782,800  1,547,200,000  24,312,782.800 

Russia    22,593,950,000  ***  22,593,950,000 

Italy     12,413.998.000  ***  12,413,998,000 

Other  Allies  3,963.867,914  ***  3,963.867,914 

Total     $145,387,690,622  $19,697,214,125  $125,690,476,497 

Germany    $40,150,000,000  $2,375,000,000  $37,775,000,000 

Austria-Hungary     ..  20,622,960,600                   ***  20,622,960,600 
Turkey      and      Bul- 
garia       2,245,200,000                    ***  2,245,200,000 

Total    63,018,160,600  2,375,000,000  60,643,160,600 

Grand  total    ...$208,405,851,222  $22,072,214,125  $186,333,637,097 

The  cost  of  putting  in  the  field  a  single  division  has  been 
estimated  by  the  General  Staff  of  the  United  States  Army 
as  follows:  2 

1E.  L.  Bogart:    Direct  and  Indirect  Costs  oj  the  Great  World  War,  p. 
267. 
2  War  Department  Document  No.  527  (W.  C.  D.  8121-39). 


182  The  Economic  Causes  of  Modern  War 

One  Infantry  Division 

Signal  supplies   $293,751.35 

Quartermaster   supplies    3,283,121.37 

Engineer   supplies    18,439.67 

Ordnance  supplies    4,435,771.20 

Medical   supplies    110,059.09 

Total    $8,141,142.68 

One  Cavalry  Division 

Signal  supplies  $283,456.37 

Quartermaster   supplies    4,716,974.81 

Engineer   supplies    17,070.77 

Ordnance  supplies    3,892,553.94 

Medical  supplies    135,145.92 

Total    $9,045,201.81 

The  cost  of  war,  being  so  tremendous,  will  tax  the  finan- 
cial resources  of  even  the  wealthiest  nation ;  and  if  the  war 
is  to  continue  for  any  considerable  period,  the  share  of  in- 
ternational finance  in  keeping  armies  in  the  field  will  be- 
come so  important  that  the  bankers,  if  they  wish,  will  be 
able  to  control  the  duration  of  hostilities. 

The  astonishing  extent  to  which  the  modern  financial 
world  is  inter-related  and  inter-dependent  (it  is  said  that 
more  than  twenty-five  per  cent,  of  the  world's  securities 1 
are  held  by  the  bankers  of  nations  other  than  those  of  the 
corporations  and  governments  issuing  the  securities)  in  it- 
self exerts  a  natural  stabilizing  influence  upon  international 
relations. 

The  large  amounts  of  the  investments  which  have  been 
placed  by  European  investors  in  countries  other  than  their 

laThe  total  foreign  investments  of  the  surplus-investing  countries  of  the 
world  aggregate  between  $26,000,000,000  and  $29,000,000,000.  As  the  world's 
negotiable  securities  according  to  M.  Alfred  Neymarck,  were,  in  1907,  ap- 
proximately $111,000,000,000,  it  will  be  seen  that  over  25  per  cent,  of  the 
investments  of  different  nations  is  in  bonds  and  stocks  of  the  outre-mer 
class."  Charles  F.  Speare:  "Foreign  Investments  of  the  Nations,"  North 
American  Review:  190-83:  Jy.,  '09. 


The  Prevention  of  War  by  International  Finance      183 

own,  is  partly  due  to  a  desire  in  certain  countries  to  escape 
taxes  on  domestic  securities;  but  it  is  also  due  to  the  finan- 
cial necessities  of  the  case.  In  France,  where  saving  has 
proceeded  much  faster  than  expenditure,  owing  to  the  na- 
tional thrift,  foreign  investment  is  an  established  policy. 

As  German  colonial  development  began  soon  after  the 
Franco-Prussian  War,  the  Germans  placed  their  invest- 
ments in  numerous  foreign  countries,  employing  the  billion 
dollar  indemnity  as  a  base  of  capital  supply  for  their  pur- 
pose. The  business  men  of  the  German  Empire  carried  out 
this  policy  to  a  greater  degree  than  those  of  any  other  na- 
tion, and  sometimes  came  near  recklessness  in  their  willing- 
ness to  invest  in  out-of-the-way  corners  of  the  world.  Un- 
able to  find  a  sufficient  field  for  investment  in  their  own 
colonies,  they  were  often  able  to  find  profitable  fields  even 
in  the  colonies  of  their  enemies.  Five  years  before  the 
Great  War  began,  the  German  investments  abroad  were  es- 
timated at  $5,000,000,000,  and  they  grew  rapidly  in  the 
years  immediately  preceding  the  war. 

The  world-wide  expanse  of  British  colonies  has  made  it 
possible  for  a  good  deal  of  the  Empire's  capital  to  be  kept 
under  the  British  flag,  and  in  general  this  capital  has  been 
invested  only  where  populations  were  increasing  and  the 
purchasing  power  was  growing.  This  condition  is  also 
partly  a  result  of  the  immense  amount  of  exporting  done 
by  the  British  and  of  the  fact  that  London  is  the  centre 
of  the  world's  money  market.  At  the  time  when  the  Ger- 
man foreign  investments  had  reached  $5,000,000,000,  the 
British  investors  were  enjoying  an  annual  income  of  $500,- 
000,000  from  a  total  of  $14,000,000,000  investments 
abroad.1 

1  These  and  the  following  figures  are  in  the  main  derived  from  an  article 
by  Charles  F.  Speare:  "Foreign  Investments  of  the  Nations,"  North  Amer- 
ican Review:  190:82-92:  Jy.,  '09. 


184  The  Economic  Causes  of  Modern  War 

The  principal  British  fields  of  investment  may  be  indi- 
cated about  as  follows: 

British  Investments  Abroad 

United  States  and  Canada    $5,850,000,000 

Africa     2,675,000,000 

Asia     2,255,000,000 

Australia    1,735,000,000 

Europe    (Continental)    1,025,000,000 

South  America    750,000,000 

The  excess  of  saving  over  expenditure  which  has  resulted 
from  the  characteristic  thrift  of  the  French  has  brought 
to  the  republic  a  large  share  of  foreign  investment.  This 
has  not  only  been  a  matter  of  quid  pro  quo,  but  an  outcome 
of  the  necessities  of  the  case.  The  desire  to  avoid  the  con- 
stantly increasing  taxation  on  securities  held  at  home,  and  a 
general  feeling  that  the  spread  of  Socialism  might  even- 
tually threaten  capital  invested  within  the  bounds  of  the 
republic,  has  also  led  to  foreign  investment. 

The  widely  distributed  area  in  which  the  $7,000,000,000 
of  French  foreign  investments  were  placed  only  a  few  years 
before  the  European  war  broke  out,  serves  to  indicate  the 
wide  distribution  of  French  influence  and  is  one  reason 
why  the  Paris  Bourse  has  always  been  so  easily  affected  by 
rumors  of  war.  The  greater  share  of  French  money  has 
gone  to  Russia,  because  of  the  cordial  relations  which  have 
existed  between  the  two  countries  since  they  came  to  real- 
ize their  common  danger  from  the  growing  power  of  the 
German.  How  very  widely  these  investments  are  scat- 
tered about  the  globe  may  be  observed  in  the  following 
table : 

French  Investments  Abroad 

Russia    $1,750,000,000 

Egypt  and  Suez  600,000,000 

Spain   and  Cuba    500,000,000 

Austria-Hungary     600,000,000 

Turkey     450,000,000 


The  Prevention  of  War  by  International  Finance      185 

Argentine,  Brazil,  and   Mexico    500,000,000 

Italy   400,000,000 

Great  Britain    250,000,000 

Portugal    200,000,000 

U.    S.    and    Canada    350,000,000 

Belgium,   Holland   and  Switzerland    225,000,000 

South  Africa    200,000,000 

China,   Japan    150,000,000 

Germany     100,000,000 

Sweden,  Norway,  and  Denmark  100,000,000 

Other  states  700,000,000 

The  investments  of  the  United  States  have  been  prin- 
cipally confined  to  the  western  hemisphere.  Mexico,  South 
America,  and  the  West  Indies  have  received  the  lion's  share 
of  American  capital  that  has  been  invested  abroad, — not 
so  large  a  proportion  of  the  country's  wealth  as  is  the  case 
in  European  countries,  because  of  the  large  field  for  in- 
vestment at  home,  due  to  the  continuing  development  of 
a  country  still  comparatively  new.  The  few  hundred  mil- 
lions which  American  financiers  invested  in  Europe  before 
the  outbreak  of  the  war  gave  the  balance  of  financial  power 
to  the  United  States,  were  more  than  offset  by  the  heavy 
investments  of  Europeans  in  this  country. 

Money  is  international  in  the  modern  world  because  in 
all  civilized  countries  the  common  basis  is  gold.  A  credit 
which  is  based  on  gold  is  an  international  credit;  and  a 
commerce  which  is  based  on  money  and  on  credit,  there- 
fore ultimately  on  gold,  is  international.  This  common 
bond  among  the  nations  is  made  stronger  by  the  astonish- 
ingly complex  system  of  agencies  through  which  the  money, 
credit,  and  commerce  of  the  world  are  bound  up  together. 
The  dollar,  the  pound,  the  franc,  the  mark,  the  ruble,  and 
the  crown  recognize  no  frontiers. 

Because  of  the  degree  of  this  interdependence,  a  disturb- 
ance in  the  peace  of  the  world,  no  matter  where,  is  certain 


186  The  Economic  Causes  of  Modern  War 

to  be  reflected  in  the  Bourses  of  Europe.  The  most  recent 
example,  prior  to  the  Great  War,  is  to  be  found  in  the  Bal- 
kan disturbances  in  1912,  when  the  mere  rumors  of  the 
mobilization  of  the  little  Balkan  states  were  sufficient  to 
depress  the  money  market  in  all  the  great  European  powers. 
On  the  first  of  October  there  was  a  severe  panic  on  the 
Berlin  Bourse  and  another  in  Vienna,  which  later  extended 
to  Paris.  London  at  first  stood  firm  in  spite  of  the  severe 
pressure  that  resulted  from  the  difficulties  on  the  Conti- 
nent, but  when  Montenegro  began  hostilities  the  series  of 
panics  in  Paris,  Berlin,  and  Vienna  resulted  in  a  wave  of 
selling  against  which  London  could  not  stand,  so  that  on 
Saturday,  October  12th,  even  the  English  money  market 
had  to  succumb. 

In  view  of  the  disastrous  results  of  the  minor  warfare  of 
the  Balkans,  which  was  the  outcome  of  the  financial  inter- 
dependence of  the  world  and  also  of  the  tangle  of  alliances 
and  economic  rivalries  of  Europe,  the  world-wide  financial 
confusion  which  resulted  when  the  Great  War  broke  out 
in  1914  is  not  surprising.  The  Balkan  scare  had  left  the 
fear  of  war  heavy  among  European  financiers,  so  that  there 
was  nearly  a  panic  in  Vienna  after  the  murder  of  the  Arch- 
duke Ferdinand,  which  was  only  averted  because  the  Mon- 
day following  the  murder  (committed  on  Sunday)  was  a 
holiday,  giving  time  to  take  preventive  measures.  Between 
July  2nd  and  13th  there  was  very  heavy  selling  and  a  de- 
cline on  the  20th.  Three  days  later  there  was  a  war  panic 
in  both  Berlin  and  Paris,  with  reflexes  in  London  and  New 
York.  The  Vienna  exchange  had  to  close  the  day  before 
the  Austrian  declaration  of  war  on  Serbia,  and  the  Mon- 
treal, Toronto,  and  Madrid  exchanges  closed  the  day  of  the 
declaration  (July  28th).  On  the  29th  the  Berlin  Bourses 
discontinued  quotations  and  the  next  day  the  panic  had 
reached  London  and  the  Bourses  were  closed  in  Petrograd 


The  Prevention  of  War  by  International  Finance      187 

and  all  the  South  American  countries.  The  London  Stock 
Exchange  and  the  New  York  Stock  Exchange  had  to  close 
on  July  31st. 

Even  though  the  capacity  of  international  finance  for 
preventing  wars  be  doubted,  these  facts  make  it  evident 
that  it  is  seldom  to  the  advantage  of  financiers  to  encour- 
age them.  The  results  are  disastrous  because  of  the  vast 
and  intricate  network  of  international  investments  and  the 
danger  which  even  the  prospects  of  war  can  create.  Finan- 
cial relations,  therefore,  tend  to  exert  a  stabilizing  influence 
upon  the  political  relations  of  the  states  of  the  world.  In- 
ternational finance  has  certainly  often  failed  to  prevent 
wars;  but  because  of  its  international  character  it  will  or- 
dinarily seek  to  keep  peace  unbroken. 

So  close  are  the  bonds  which  unite  the  nations  that  an 
eminent  British  statesman  once  suggested  that  in  the  event 
of  hostilities  between  England  and  the  United  States,  the 
British  might  begin  their  efforts  to  injure  American  com- 
merce and  finance  by  burning  the  warehouses  at  Liver- 
pool, while  the  Americans  retaliated  in  similar  fashion  on 
the  warehouses  in  New  York! 

In  spite  of  the  writings  of  a  certain  school  of  theorists 
who  have  tried  to  make  their  readers  see  the  financier  as  a 
sort  of  Mephistopheles  forever  at  the  statesman's  elbow 
urging  him  on  to  war  as  a  profitable  investment,  and  in 
spite  of  the  undoubted  effects  of  economic  rivalry  in  creat- 
ing war,  there  is  certainly  another  side  to  the  picture.  No 
state  in  the  modern  world  can  wage  war  without  the  as- 
sistance of  the  international  financiers.  Although  financier 
and  statesman  may  be  carried  together  into  a  war  which 
they  cannot  prevent  in  spite  of  the  probable  wrecking  of 
the  commercial  life  of  the  nation,  the  weight  of  the  finan- 
cial interests  is  likely  to  be  against  war  if  only  because  of 
the  importance  of  the  money  interests  at  stake. 


188  The  Economic  Causes  of  Modern  War 

Yet  it  is  quite  clear  that  international  finance  has  had  a 
good  deal  to  do  with  the  desires  for  concessions  and  spheres 
of  influence  which  have  caused  so  many  wars.  It  is  also 
certain  that  in  many  cases  when  a  refusal  to  grant  war 
loans  to  foreign  nations  would  have  halted  hostilities,  the 
financiers  have  seen  the  opportunity  for  a  good  investment 
in  foreign  governments'  bonds  and  have  not  chosen  to  ex- 
ercise their  power.  One  may  imagine  the  probable  predica- 
ment of  Japan  in  1904  had  the  English  financiers  refused 
to  float  her  loans;  and  there  is  more  than  a  suspicion  that 
the  ending  of  the  war  came  in  part  because  credit  was  be- 
ginning to  fail. 

Before  the  World  War  it  was  thought  that  the  magni- 
tude of  the  commercial  and  financial  relations  between 
England  and  Germany  might  prevent  a  war  between  the 
two  states  in  spite  of  the  many  causes  of  increasing  fric- 
tion. The  distinguished  English  statistician,  Edgar  Cram- 
mond,  could  write  in  November,  1913,  less  than  a  year  be- 
fore the  outbreak  of  hostilities:  x 

"London  accepting  firms  lend  enormous  sums  for  the  purpose 
of  financing  the  trade  of  Germany,  Italy,  Austria,  and  other 
European  countries.  By  means  of  acceptances,  London  finances 
one  Power  alone  (Germany)  to  the  extent  of  about  70,000,000 
pounds  at  any  given  moment.  This  money  has  been  borrowed 
from  the  English  Joint  Stock  Banks  by  the  accepting  houses, 
and  if  war  should  break  out,  say,  between  Great  Britain  and 
Germany,  the  London  accepting  firms  would  be  placed  in  a 
highly  dangerous  position.  They  would  have  made  themselves 
liable  for  the  payment  to  the  Joint  Stock  Banks,  within,  say, 
three  months  of  the  outbreak  of  war,  of  the  sum  of  70,000,000 
pounds  against  bills  drawn  on  German  account.  The  accepting 
houses  could  not,  of  course,  pay  the  whole  of  this  vast  sum  unless 
they  received  it  in  the  ordinary  course  of  business  from  their 

1  Edgar  Crammond:  "Financial  Preparation  for  War,"  Nineteenth  Cen- 
tury: 74:939:   N.,  '13. 


The  Prevention  of  War  by  International  Finance      189 

German  clients.  In  the  circumstances  named,  it  is  more  than 
doubtful  whether  the  German  clients  could  or  would  pay  this 
amount  and  in  that  event  what  would  be  the  position  of  the 
London  accepting  firms  and  the  English  Joint  Stock  Banks?" 

Three  years  earlier  the  same  writer  had  prophesied  ex- 
actly what  came  true  ten  years  after  his  prophecy ;  namely, 
enormous  German  losses  from  an  unsuccessful  war  with 
Great  Britain:1 

"War  with  Great  Britain,  if  unsuccessful,  would  involve  enor- 
mous losses  to  the  German  people.  ...  A  very  large  amount  of 
British  capital  is  employed  in  financing  the  trade  of  the  German 
Empire;  and  the  economic  ties  which  bind  the  two  countries  are 
of  the  most  intimate  character.  A  rupture  of  these  relations 
would  prove  disastrous  to  both  countries." 

Read  in  the  light  of  subsequent  events,  these  passages 
serve  to  show  the  over-reliance  that  was  placed  upon  the 
financial  bond.  None  the  less,  the  effect  of  this  inter-re- 
lation in  the  world's  finances  has  been  felt  on  the  side  of 
peace  on  several  occasions. 

Although  international  finance  has  failed  on  numerous 
occasions  to  prevent  war,  and  has  on  equally  numerous  oc- 
casions made  no  especial  effort  to  prevent  it,  it  has  also 
been  successful  in  checking  hostilities  before  they  began. 
The  preponderant  influence  of  the  United  States  in  South 
American  countries  is  not  entirely  due  to  the  armed  might 
of  her  army  and  navy;  for  it  is  certainly  true  that  the 
enormous  investments  of  American  business  concerns  in 
those  countries  make  for  the  maintenance  of  peace,  partly 
through  the  power  of  finance,  and  partly  because  of  the 
implied  threat  of  intervention  should  the  holdings  of  Amer- 
ican capitalists  come  to  harm.     The  important  point  for 

1  Edgar  Crammond:  "Finance  in  Time  of  War,"  Quarterly  Review, 
213:323,  O.,  10. 


190  The  Economic  Causes  of  Modern  War 

present  purposes,  is  the  fact  that  international  finance  in 
the  western  hemisphere  is  certainly  operating  to  avoid  war. 

The  possibility  of  another  aspect  of  American  finance  in 
the  countries  of  South  America  is,  however,  only  too  fa- 
miliar. It  is  well  known  that  American  financial  interests 
have  repeatedly  been  powerful  in  urging  the  intervention 
of  the  United  States  in  Mexico,  at  the  certain  expense  of 
a  long  and  bloody  war.  Other  of  the  more  powerful  com- 
panies engaged  in  South  American  trade  have  been  sus- 
pected both  of  fomenting  revolution  and  of  attempting  to 
use  naval  power  to  further  their  own  interests  once  dis- 
order has  begun. 

Instances  are  not  lacking  in  European  history  of  the 
influence  of  international  finance,  either  in  postponing,  lim- 
iting, or  preventing  war  altogether.  Credits  withheld  from 
Philip  II  by  the  merchants  of  Genoa,  as  a  result  of  the 
persuasion  of  English  merchants,  at  the  time  when  the 
outfitting  of  the  Spanish  Armada  was  in  progress,  delayed 
the  sailing  of  that  formidable  fleet  for  a  year,  during  which 
the  English  preparations  for  meeting  it  had  progressed  so 
far  that  it  could  be  defeated.  These  early  international 
financiers,  to  be  sure,  did  not  prevent  the  war,  yet  not  only 
did  they  postpone  it,  but  they  also  shortened  its  duration 
and  directly  affected  its  outcome. 

What  could  be  done  three  hundred  years  ago  when  every 
country  was  more  nearly  self-sufficient  than  any  country 
is  today,  both  economically  and  financially,  can  be  accom- 
plished much  more  readily  and  completely  at  present.  The 
coldly  commercial  motives  (without  considering  others) 
which  urge  financiers  to  undertake  such  action  are  far  more 
powerful,  now  that  the  possibilities  for  the  unsettling  of 
commerce  and  finance  by  war  are  so  greatly  increased,  and 
now  that  the  destructiveness  and  costliness  of  war  are  so 
much  greater. 


The  Prevention  of  War  by  International  Finance      191 

Even  in  the  middle  of  the  Nineteenth  Century,  Napoleon 
III  had  to  give  up  his  plans  to  undertake  the  expulsion  of 
the  Austrians  from  Italy,  because  the  mere  rumor  of  the 
proposed  campaign  caused  a  panic  on  the  Bourse.  Nearly 
half  a  century  afterward  the  resentment  of  the  French  over 
colonial  friction  with  the  English  in  the  Sudan  and  Cen- 
tral Africa  was  palpably  allayed  by  the  rise  in  value  of 
Egyptian  bonds,  due  to  the  British  occupation.  The 
French  investments  in  these  securities  had  been  very  heavy. 
When  it  is  considered  that  at  the  time  of  the  Fashoda  in- 
cident (1898),  public  opinion  in  France  would  have  sup- 
ported a  war  with  England  had  the  internal  condition  of 
the  republic  made  it  possible,  but  that  within  six  years  it 
had  been  modified  sufficiently  to  permit  the  Entente  Cor- 
diale  to  be  established,  the  possibilities  of  international 
finance  in  the  pacification  of  public  opinion  and  in  pre- 
venting war  become  evident. 

One  of  the  most  recent  examples  of  the  prevention  of 
war  by  financial  influence  is  the  action  of  the  French  bank- 
ers at  the  time  of  the  war  scare  after  the  Agadir  incident 
in  1911.  The  precise  details  of  the  transactions  which  went 
on  at  the  time  are  shrouded  in  a  businesslike  reticence, 
but  the  essentials  are  sufficiently  known  to  make  it  pos- 
sible to  deduce  with  accuracy  what  occurred. 

As  the  German  attitude  over  Morocco  became  more  and 
more  threatening  and  the  prospect  of  a  European  war  was 
imminent,  the  French  bankers  began  quietly  to  withdraw 
their  enormous  investments  in  Germany,  continuing  this 
process  until  the  economic  pressure  reached  such  a  stage 
that  the  situation  was  relieved.  So  severely  were  the  ef- 
fects of  this  pacific  financial  maneuvre  felt  in  Germany 
that  many  business  houses  were  on  the  point  of  failure, 
until  the  Reichsbank  came  to  the  rescue. 

The  gunboat  "Panther"  had  been  sent  to  Agadir  on  July 


192  The  Economic  Causes  of  Modern  War 

1st,  initiating  a  crisis  which  involved  all  of  political,  mili- 
tary, naval,  and  financial  Europe.  German  industrial  en- 
terprises, already  heavily  in  debt  to  France,  and  having 
been  accustomed  to  meet  their  growing  needs  with  further 
borrowing,  found  themselves  by  September  and  October  in 
need  of  300,000,000  francs,  when  all  French  credit  was  re- 
fused them.  They  were  compelled  to  turn  to  the  United 
States  and  to  pay  from  six  to  seven  per  cent,  for  money 
which  they  might  ordinarily  have  borrowed  from  French 
banks  at  three  and  four  per  cent.1 

This  example  of  the  characteristic  French  method  of 
meeting  a  strained  situation  in  international  affairs — "rat- 
tling the  purse"  as  opposed  to  the  characteristic  tactics  of 
the  German  Empire  in  "rattling  the  sabre" — serves  to  show 
what  can  be  accomplished  by  a  group  of  able,  resolute,  and 
patriotic  financiers,  holding  the  right  investments,  at  a 
moment  of  extreme  national  peril. 

The  dual  role  which  international  finance  plays  is  shown 
in  this  incident  by  the  fact  that  it  is  also  quite  probable 
that  other  financial  interests,  both  French  and  German, 
may  have  had  a  great  deal  to  do  with  precipitating  this 
very  crisis  for  their  own  ends.  Socialists  alleged,  during 
the  progress  of  the  crisis,  that  a  secret  understanding  ex- 
isted between  certain  French  and  German  financiers,  and 
that  the  government  was  allowing  itself  to  be  made  a  cats- 
paw. 

The  French,  because  of  their  large  foreign  investments 
(larger,  probably  than  the  British,  since  many  of  these  are 
not  strictly  foreign  but  merely  colonial)  and  also  because 
a  large  part  of  their  investments  are  in  the  bonds  of  other 
governments,  can  exert  a  greater  pressure  than  most  other 
nations.  The  influence  that  French  finance  could  exert 
over  Russia  in  the  years  before  the  war  is  evident;  and 

*W.  M.  Fullerton:  Problems  of  Power,  p.  216. 


The  Prevention  of  War  by  International  Finance      193 

there  was  a  similar  power  of  the  purse  among  the  Balkan 
nations. 

The  nature  of  this  financial  power  had  been  illustrated 
before  Agadir  in  the  flare-up  in  the  Near  East  in  1909, 
when  the  balance  of  power  remained  in  Paris  because  of 
the  action  of  the  French  financiers  in  demanding  peace  as 
a  quid  pro  quo  for  their  relief  of  the  prospective  belliger- 
ents in  their  time  of  financial  stress.  A  journalist  com- 
menting on  these  incidents  at  the  time  observed  that: 
"France  could  almost  dictate,  if  she  wished,  the  political 
policies  of  half  a  dozen  European  countries,  the  bulk  of 
whose  debt  she  holds."  1  At  the  time  of  the  Balkan  scare 
of  1912,  French  loans  to  Rumania,  Bulgaria,  and  Serbia 
aggregated  1,000,000,000  francs.2 

In  the  recent  friction  between  China  and  Japan,  the 
Chinese,  knowing  their  military  impotence  as  matters 
stood,  have  had  recourse  to  economic  and  financial  pres- 
sure. Persisted  in  unofficially  in  spite  of  edicts  from  Pekin, 
this  pressure  did  succeed  in  producing  a  mitigation  of  the 
rigors  of  Japanese  policy.  In  South  China,  where  the 
measures  were  most  effective,  Japanese  imports  fell  in  Oc- 
tober, 1919,  to  87,000  yen  as  against  611,000  yen  for  the 
same  month  of  the  previous  year.3  No  industrial  state  can 
withstand  such  pressure. 

It  is  clear  that  international  finance,  by  its  mere  com- 
plexity, exerts  an  immense  influence  in  stabilizing  the 
relations  between  nations,  and  that  if  circumstances  are  fa- 
vorable and  the  financiers  involved  are  willing,  it  can  pre- 
vent war,  seeing  it  has  already  done  so  on  several  occasions. 

Impressed  with  these  undeniable  facts,  however,  numer- 

1  Charles  F.  Speare:  "Foreign  Investments  of  the  Nations,"  North  Amer- 
ican Review:  190:92:  Jy.,  '09. 

2  L' Information,  January  10,  1913. 

'Charles  H.  Sherrill:  Have  We  a  Far  Eastern  Policy?  p.  265. 


194  The  Economic  Causes  of  Modern  War 

cms  writers  have  expected  too  much  of  the  financier.  A 
writer  in  the  ardently  pacifist  New  York  Independent,  com- 
menting on  the  Agadir  affair,  wrote:1 

"It  is  becoming  every  day  more  clear  that  the  great  financial 
interests  of  the  world  can  'hold  up'  war  when  they  once  make 
up  their  minds  to  do  it.  We  do  not  overlook  the  fact  that  ru- 
mors of  war  .  .  .  instantly  exert  a  depressing  influence  upon 
financial  operations.  .  .  . 

"What  is  chiefly  needed  today  is  a  policy  of  daring  and  resolu- 
tion on  the  part  of  the  leaders  of  finance,  industry,  and  public 
opinion.  .  .  .  The  moment  that  the  great  financial  interests  say 
the  word,  it  will  become  suicidal  for  any  nation,  however  obsessed 
with  notions  of  its  own  greatness,  to  break  the  peace." 

The  very  incident  upon  which  this  journal  was  com- 
menting, however,  illustrates  both  of  the  ways  in  which 
international  finance  may  be  of  influence  in  international 
relations.  There  is  reason  enough  for  believing  that  finance 
had  much  to  do  alike  with  provoking  and  allaying  this 
crisis. 

It  is  a  more  just  view  to  regard  international  finance 
as  either  a  safeguard  or  a  menace  to  peace,  according  to 
circumstance.  It  is  a  powerful  force,  but  it  is  a  force  that 
is  in  the  hands  of  its  controllers,  the  bankers,  and  it  may 
make  either  for  peace  or  for  war,  as  they  desire.  Invest- 
ments in  the  bonds  of  a  backward  nation,  as  in  the  case 
of  Egypt,  may  well  lead  to  hostilities  when  it  becomes  im- 
possible for  the  creditors  to  collect  without  the  armed  as- 
sistance of  their  governments. 

The  view  sometimes  expressed,  that  the  destruction  of 
the  financial  system  of  an  invaded  state  would  react  so 
powerfully  upon  the  aggressor  as  to  ruin  his  own  finances, 
falls  to  the  ground  when  it  is  considered  that  there  is  no 
real  reason  why  the  financial  and  banking  system  of  an 

independent:  71:104-105;  Je.  13,  '11. 


The  Prevention  of  War  by  International  Finance      195 

invaded  state  should  be  at  all  interfered  with  by  the  in- 
vader, who  proceeds  with  his  wholly  military  occupation 
without  meddling  with  finance. 

The  belief  that  the  expense  of  modern  wars  may  deter 
states  from  entering  upon  them,  must  be  dismissed  or  modi- 
fied in  view  of  the  evidence  of  1914  and  of  previous  his- 
tory which  goes  to  show  that  monetary  difficulties  have 
usually  been  overcome  somehow  by  states  which  felt  war 
necessary.  Wars  have  often  cost  infinitely  more  than  the 
statesmen  who  engaged  in  them  expected,  but  in  most 
cases  they  have  been  able  to  find  means  of  struggling 
through  to  the  end. 

Financial  difficulties  have  not  always  in  the  past  been 
sufficiently  a  bogey  to  prevent  wars;  nor  has  the  influence 
of  financiers  been  invariably  cast  against  war.  On  the 
other  hand,  the  stabilizing  influence  of  international  finan- 
cial relations,  and  the  examples  of  their  prevention  of  war 
offer  evidence  of  their  value  in  preserving  peace. 


CHAPTER  VI 

INTERNATIONALISM    AND    ECONOMIC    CONFLICT 

The  doctrine  of  internationalism  is  peculiarly  the  prod- 
uct of  European  civilization  and  of  the  Nineteenth  and 
Twentieth  Centuries.  It  is  an  idea  which  has  grown  up 
simultaneously  with  the  development  of  the  bitter  economic 
conflicts  between  nations  resulting  from  industrialism,  and 
an  idea  which  has  derived  added  force  from  the  appalling 
character  of  the  wars  of  the  period.  At  no  other  time  in 
history  could  the  idea  of  the  "family  of  nations"  have 
been  so  thoroughly  comprehended,  and  at  no  other  time 
could  the  tendency  toward  a  higher  unity  than  that  of 
mere  nationality  have  been  stronger,  than  in  the  Europe 
which  has  just  passed  through  the  greatest  and  bloodiest 
\yar  ever  fought. 

Nations  hitherto  have  been  concerned  mainly  with  their 
own  development.  They  have  looked  on  one  another  either 
as  rivals  or  as  possible  allies^  to  be  used  in  attaining  na- 
tional  ends  and  cast  aside  as  soon  as  they  ceased .  to  be 
useful — a  theory  of  international  relations  which  has  by 
no  means  disappeared.  The  idea  of  the  family  of  nations 
and  of  the  community  of  many  of  their  characteristics  and 
of  their  civilization,  is  a  peculiarly  modern  thing.  A  sort 
of  internationalism  existed  among  the  small  city  states  of 
ancient  Greece,  held  together  by  the  common  tie  of  their 
Hellenic  blood  and  meeting  at  stated  periods  in  what  were 
probably  the  first  international  events,  the  Olympic  games. 
But  the  ideas  of  internationalism,  of  the  community  of 

196 


Internationalism  and  Economic  Conflict  197 

interests  of  the  whole  world,  and  of  the  possibility  of  a 
world  state  not  based  on  conquest,  have  developed  only 
within  the  last  century. 

Geographic  conditions  have  nowhere  been  so  favorable 
to  the  rise  of  the  international  spirit  as  in  Europe.  In  the 
Orient,  barriers  interposed  between  the  developing  civi- 
lizations of  China,  Japan,  and  India,  so  that  each  could 
in  isolation  build  up  its  peculiar,  self-contained  culture, 
seeking  nothing  from  other  lands,  and  feeling  the  need  of 
nothing.  On  the  European  continent  there  were  no  such 
barriers,  no  mountain  ranges  large  enough  to  be  insur- 
mountable, and  rivers  such  as  the  Rhine,  Meuse,  Scheldt, 
and  Danube,  whose  courses  served  rather  to  connect  than 
to  divide  the  peoples  of  the  continent. 

Here  there  grew  up  a  group  of  nations  nearly  equal  in 
power,  no  one  sufficiently  stronger  than  the  others  to  main- 
tain a  long-continued  supremacy.  During  the  very  period 
in  which  the  suspicions,  distrusts,  and  economic  struggles 
whose  course  has  been  traced  in  the  preceding  chapters, 
were  at  their  height,  there  was  also  developing  among  these 
states  another  idea.  This  found  expression  in  the  "Con- 
cert of  Europe,"  invoked  again  and  again  during  the  Nine- 
teenth Century  in  lieu  of  recourse  to  arms,  for  the  settle- 
ment of  questions  of  common  concern.  During  the  years 
following  the  downfall  of  Napoleon,  the  Concert  acted  on 
numerous  important  questions,  sometimes  in  perfect  har- 
mony, more  often  with  many  differences,  but  always  in 
recognition  of  the  existence  of  questions  in  which  all  the 
Powers  had  interests  and  in  whose  settlement  each  was  en- 
titled to  a  voice.  This  unity  sprang  out  of  the  alliance 
which  had  been  formed  to  overthrow  Napoleon,  and  it  con- 
tinued, though  with  unanimity  somewhat  abated,  through- 
out the  greater  part  of  the  century. 

The  chief  contribution  that  this  principle  made  to  Euro- 


198  The  Economic  Causes  of  Modern  War 

pean  politics  was  the  establishment  of  the  custom  of  Con- 
gresses at  which  the  diplomats  of  the  various  states  met 
to  discuss  and  decide  upon  the  issues  arising  between  them. 
At  the  height  of  its  prestige  the  Concert  occupied  almost 
the  position  of  an  international  tribunal  capable  of  deal- 
ing with  all  matters  which  concerned  Europe  as  a  whole. 
Its  purpose  was  the  maintenance  of  peace  through  the 
recognition  of  the  principle  that  all  the  states  of  Europe 
had  a  vital  interest  in  territorial  changes,  which  should  on 
that  account  be  settled  by  general  agreement  rather  than 
by  agreement  only  between  the  two  Powers  immediately 
involved. 

After  the  Congress  of  Berlin  in  1878,  divisions  began  to 
be  formed  among  the  Great  Powers,  resulting  finally  in  the 
formation  of  the  Triple  Alliance  and  the  Triple  Entente. 
The  "Concert  of  Europe"  had  become  the  "Balance  of 
Power."  Two  groups  of  states — the  members  of  each  hav- 
ing patched  up  the  economic  and  political  rivalries  as  best 
they  could,  and  each  group  having  fairly  well-defined  and 
conflicting  economic  objects — confronted  one  another. 
Each  protested  earnestly  its  desire  for  peace;  each  prepared 
constantly  for  war. 

The  disruptive  results  of  these  economic  rivalries  and 
of  the  Balance  of  Power  in  which  they  were  expressed  could 
not  undo  the  work  that  had  already  been  begun.  The  seed 
of  the  idea  of  internationalism  had  been  sowed,  and  it  bore 
fruit  continuously  throughout  the  Nineteenth  Century  in 
various  forms  of  international  co-operation  for  the  com- 
mon benefit  of  all  nations. 

In  the  century  between  1814  and  the  outbreak  of  the 
World  War,  sixty-four  official  conferences  were  held,  in 
which  the  representatives  of  from  three  to  fifty  states  met 
to  consider  subjects  of  common  international  interest  vary- 
ing from  the  control  of  the  African  slave  trade  to  the  ex- 


Internationalism  and  Economic  Conflict  199 

change  of  works  of  art.1  In  addition  to  these  official  con- 
ferences, in  which  the  envoys  represented  the  governments 
of  Europe  and  of  the  world,  there  were  more  than  seven 
hundred  international  conferences,  congresses,  confedera- 
tions, and  alliances,  in  which  the  delegates  represented  pri- 
vate interests  only.  The  subjects  for  consideration  at 
these  gatherings  included  serious  social  questions,  such  as 
the  control  of  alcohol  and  of  prostitution,  the  promotion  of 
peace,  race  hygiene,  the  suppression  of  duelling,  eugenics, 
juvenile  courts,  as  well  as  subjects  of  religious,  profes- 
sional, or  artistic  interest.  There  were  thirty-two  religious 
gatherings  (which  purported  to  be  international  in  char- 
acter, although  at  many  of  them  few  nations  were  repre- 
sented) and  thirty-seven  international  conferences  for  the 
consideration  of  educational  questions.  Between  1847  and 
1913  there  were  nearly  two  hundred  fifty  conferences  on 
various  scientific  subjects,  including  medicine,  entomology, 
linguistics,  embryology,  psychic  research,  pathology,  radiol- 
ogy and  the  like,  holding  sessions  which  varied  in  number 
from  one  to  twenty-eight.  There  were  almost  as  many  con- 
ferences on  economic  subjects,  among  which  were  included 
congresses  to  discuss  colonial  agronomy,  metallurgy,  agricul- 
ture, railways,  marine  work,  textiles,  cattle  breeding, 
ceramics,  and  seed  testing.  Almost  without  exception  these 
conferences  met  in  European  capitals,  and  the  countries 
represented  were  principally  European,  although  the 
greater  part  of  the  world  came  to  be  represented,  espe- 
cially in  those  held  more  recently. 

The  increased  ease  of  communication,  which  was  the  re- 
sult of  the  growth  of  railway,  telephone,  telegraph,  cable, 
and  the  newspaper,  added  greatly  to  the  international  spirit. 
It  accounts  for  the  increased  frequency  with  which  the 

1  Exhaustive  lists  of  these  conferences  are  given  in  the  appendix  to 
J.  C.  Fanes:  The  Rise  of  Internationalism,  pp.  181-202. 


200  The  Economic  Causes  of  Modern  War 

international  conferences  came  to  be  held,  until  in  the 
year  before  the  Great  War  broke  out,  no  less  than  forty- 
one  conferences  were  held  in  various  parts  of  Europe,  in- 
ternational in  character  and  considering  a  wide  variety 
of  economic,  professional,  social,  and  artistic  questions. 

The  movement  towards  internationalism  took  concrete 
form,  too,  in  the  organization  of  numerous  unions,  bureaus, 
and  conventions  for  the  accomplishment  of  a  number  of 
scientific  and  mercantile  purposes  which  were  best  to  be 
carried  out  by  a  number  of  states  acting  in  co-operation. 
Among  the  most  important  of  these  were  the  General  Post- 
al Union,  the  Metric  Convention,  the  Central  Office  of 
International  Transport,  and  the  International  Union  for 
the  Publication  of  Tariffs,  each  of  which  had  an  obvious 
economic  significance. 

The  General  Postal  Union  was  founded  at  Berne  in 
1874,  with  twenty-one  states  as  members.  Four  years  later 
it  was  replaced  by  the  Universal  Postal  Union,  meeting  at 
Paris;  and  the  convention  has  since  been  revised  by  Con- 
gresses meeting  at  Lisbon  in  1885;  Vienna,  1891;  Washing- 
ton, 1897;  and  Rome,  1906. 

Considerations  of  convenience  in  view  of  the  growing 
volume  of  international  business  relations  led  to  the  es- 
tablishment of  the  Metric  Convention  in  1875,  with  rati- 
fications by  practically  all  the  Powers  of  the  world,  and 
to  the  erection  of  the  International  Bureau  of  Weights  and 
Measures  with  a  central  office  at  Paris,  under  the  control 
of  an  international  committee. 

Convenience  in  business  relations  led  in  1890  to  the 
formation  of  the  Union  for  the  Publication  of  Tariffs  at 
Brussels,  maintaining  a  permanent  bureau  in  the  city  of 
its  origin  so  that  information  may  readily  be  obtained  as 
to  the  tariffs  of  the  countries  of  the  world.  A  more 
strictly  European  international  bureau  is  the  Central  Of- 


Internationalism  and  Economic  Conflict  201 

fice  of  International  Transport,  a  railway  union  of  all  the 
continental  powers  for  the  purpose  of  harmonizing  their 
rail  systems. 

Such  international  organizations  are  necessary  and  are 
possible  because  of  the  increasing  complexity  of  the  com- 
mercial and  financial  relations  of  the  world.  The  modern 
economic  system  has  a  side  other  than  the  fierce  struggle 
sketched  in  the  previous  chapters.  It  is  true  that  con- 
flict between  the  economic  interests  of  the  European  na- 
tions, as  they  have  expanded  into  the  far  parts  of  the 
world,  has  led  to  constant  war,  because  of  fear  for  the  safety 
of  food  supplies,  raw  materials,  and  markets.  But  this  ex- 
pansion of  the  modern  world,  with  its  consequent  interde- 
pendence of  states,  has,  it  is  equally  true,  led  to  a  growth 
of  the  international  spirit. 

The  same  economic  forces  that  have  led  to  constant  war 
in  all  quarters  of  the  earth  are,  through  the  complexity  of 
organization  which  they  involve,  fostering  the  international 
spirit.  International  trade  cannot  go  on  without  inter- 
national co-operation. 

Modern  industrialism  tends  to  create  internationalism  in 
some  measure,  simply  because  it  has  grown  to  such  an  ex- 
tent that  its  trade  necessarily  oversteps  frontiers.  The 
type  of  internationalism  produced  by  our  present  indus- 
trial and  economic  system  is  so  far  from  ideal  that  we 
seldom  think  of  it  as  being  international  at  all.  It  is  dif- 
ferent from  the  ideal  and  wholly  Utopian  world  state  that 
is  usually  associated  with  the  word  "internationalism,"  that 
we  fail  to  recognize  it.  Utopia  is  only  an  extreme  of  in- 
ternationalism, however,  and  internationalism  may  exist 
without  extremes. 

Although,  when  contrasted  with  the  international  ideal, 
the  condition  of  the  world  since  1878 — with  its  wars,  its  bit- 
ter  commercial   rivalries,   its  quarrels   over   colonies   and 


202  The  Economic  Causes  of  Modern  War 

spheres  of  influence — appears  a  chaos,  one  has  but  to  con- 
trast it  with  an  extreme  nationalism  to  see  that  a  very- 
real  and  fairly  extensive  degree  of  internationalism  has 
actually  existed  for  a  long  time.  The  self-sufficing  nation 
— whether  economically  or  culturally — no  longer  exists.  If 
we  contrast  the  Europe  of  1840  with  the  exclusively  na- 
tionalistic Japan  of  the  same  date,  the  degree  to  which 
internationalism  had  even  then  grown  up  is  at  once  ap- 
parent. 

Internationalism  has  been  a  very  real  thing  in  the  worlds 
of  science,  art,  and  literature  for  a  long  time.  Trade  be- 
tween the  nations  and  the  necessity  for  external  markets 
and  external  sources  of  food  and  raw  materials  have  grown 
so  largely  within  the  last  half  century  that  commerce  has 
become  international.  Business  and  industry  have  ignored 
frontiers  to  an  extent  never  approached  before  in  the  his- 
tory of  the  world. 

The  political  interweaving  of  the  world  by  military  force 
is  an  old  story.  The  absolute  dependence  of  the  various 
countries  of  the  present  world  through  finance  and  com- 
merce^— so  complete  that  every  state  is  influenced  imme- 
diately and  obviously  by  the  economic  conditions  prevail- 
ing in  other  states — is  a  new  story.  This  condition  has  come 
about  through  the  rise  of  industrialism,  with  the  conse- 
quent necessity  of  expansion  into  all  parts  of  the  globe. 
Commerce  has  become  an  international  agency  and  the 
business  men  and  financiers  of  the  various  nations  begin 
to  find  frontiers  rather  a  hindrance  than  a  help.  Even 
French  and  German  financiers  have  ventured  to  co-oper- 
ate in  Morocco. 

It  is  because  of  this  fact  that  the  tendency  has  begun 
to  standardize  so  far  as  possible  the  commercial  conven- 
iences of  the  whole  world.  Here  is  to  be  found  the  origin 
of  railroad  agreements,  international  tariff  agencies,  inter- 


Internationalism  and  Economic  Conflict  203 

national  rates  of  exchange,  international  units  of  measure, 
and  the  rest  of  the  means  of  co-operation  between  individ- 
uals of  different  states  and  the  states  themselves.  It  is 
not  without  significance  that  the  American  decimal  mone- 
tary system  was  taken  over  in  toto  by  the  Canadians,  in 
preference  to  the  more  complicated  English  system.  A 
century  ago  there  would  have  been  no  need  for  an  inter- 
national coinage  comparable  to  the  need  today,  nor  for 
the  publication  of  international  tariffs  and  an  international 
system  of  weights  and  measures.  International  trade,  in- 
deed, existed,  but  the  industrial  life  of  most  of  the  states 
of  Europe  did  not  then  depend  upon  it,  nor  could  the  pre- 
vention of  importation  or  exportation  cause  widespread  suf- 
fering among  the  people  of  a  whole  nation,  as  it  can  today. 
An  apparent  exception  to  this  is  to  be  found  in  the  con- 
dition of  the  British  Isles,  which  would  even  then  have 
suffered  from  lack  of  food.  But  even  here  the  alteration 
which  the  modern  industrial  changes  and  the  consequent  in- 
ternational dependence  have  brought  about  is  very  marked. 
The  Revolution  in  America  could  cause  little  industrial 
unsettlement  in  England  in  1776,  even  though  imports 
from  the  colonies  were  interfered  with.  The  American 
Civil  War,  less  than  a  century  later — the  inter-relation  of 
precisely  the  same  territories — could  cause  so  much  British 
suffering  as  to  provoke  the  thought  of  intervention,  a  re- 
sult of  the  growing  complexity  of  the  world's  economic  sys- 
tem, and  the  growing  interdependence  among  nations. 

At  first  thought  it  seems  that  such  a  state  of  affairs — 
in  which  the  interests  of  the  nations  are  continually  be- 
coming more  and  more  closely  united  and  in  which  the 
frontiers  are  an  annoyance  if  not  a  hindrance  to  the  busi- 
ness men  who  are  the  dominant  powers  in  the  life  of  most 
industrial    states — would    automatically    produce    Utopia 


204  The  Economic  Causes  of  Modern  War 

overnight.  If  the  nations  of  the  world  are  so  inter-united 
that  they  cannot  get  along  without  one  another,  we  might 
well  expect  to  wake  up  some  morning  to  find  that  by  a 
gradual  progress  of  world  evolution  they  have  merged  into 
one,  and  that  the  federation  of  the  world  has  arrived  in 
the  guise  of  an  economic  necessity. 

How  far  this  is  from  being  the  actual  case,  the  con- 
tinuing wars,  whose  genesis  can  be  so  easily  traced  to  eco- 
nomic causes,  suffice  to  show.  Neither  the  tendency  toward 
internationalism  arising  from  economic  conditions,  nor  the 
tendency  toward  wars  arising  from  the  same  source,  can  be 
denied.  Contradictory  though  they  are,  they  co-exist;  and 
they  are  both  the  outcome  of  the  same  cause:  the  pres- 
sure of  population,  out  of  which  grows  industrialism.  An 
industrial  state  of  society  means  an  enormously  complex 
dependence  of  civilized  nations  on  one  another  and  on  un- 
developed territory.  Such  interdependence  means  both 
co-operation  and  conflict.  A  strange  pair  of  twins  from 
the  same  mother — internationalism  and  war. 

Both  are  the  results  of  the  economic  system  of  the  day. 
From  it  internationalism  arises  because  of  the  necessity  for 
commercial  relations  with  other  states  and  their  dependen- 
cies, and  from  the  community  of  interests  which  is  thus 
brought  about.  From  it  economic  rivalry,  with  its  result- 
ant wars,  arises  because  of  the  clash  of  interests  between 
industrial  Powers  contesting  for  markets,  raw  materials, 
and  food. 

Examples  of  the  co-existence  of  co-operation  and  conflict 
are  frequent  enough  in  recent  history.  Germany  and 
France  were  political  and  economic  rivals  in  many  spheres. 
The  hostility  existing  between  them — it  had  been  an  ad- 
mitted fact  of  world  politics  for  years — would  in  the  end 
lead  to  hostilities.  In  Africa,  in  the  Far  East,  in  Alsace 
and  Lorraine,  in  the  frontier  restrictions  on  imports  and 


Internationalism  and  Economic  Conflict  205 

exports,  economic  rivalry  produced  a  sharp  clash  of  inter- 
ests. German  industry  grew  and  nourished  on  the  iron  de- 
posits taken  from  the  correspondingly  crippled  French  in- 
dustry. The  economic  hostility  between  the  two  was  clear 
enough  and  its  share  in  producing  war  has  been  amply 
demonstrated. 

At  the  same  time  that  this  rivalry  was  growing  up,  how- 
ever, there  was  also  growing  up  between  them  a  com- 
munity of  interests  which  arose  out  of  their  commercial 
relations.  Since  Germany  and  France,  despite  their  dif- 
ferences, had  to  trade  with  one  another,  the  Metric  Con- 
vention,— an  international  measure  and  a  step,  however 
slight, — to  the  breaking  down  of  national  barriers,  had  to 
be  adopted  because  it  was  a  convenience  for  commerce. 
One  cannot  imagine  a  pair  of  isolated  states  such  as  China 
and  Japan  in  1840  finding  necessity  for  such  a  convention, 
because  no  international  trade  relations  of  any  considerable 
extent  existed.  Similarly,  the  tariff  publications,  the  agree- 
ments with  regard  to  cables,  wireless,  mails,  railways, — 
all  measures  tending  to  bring  the  nations  of  the  world 
closer  and  closer  together — have  grown  out  of  the  inter- 
nationalism of  trade  resulting  from  the  very  industrialism 
which  was  breeding  simultaneously  the  wars  that  tore  the 
nations  apart. 

The  situation  is  a  paradox  on  a  world-wide  scale. 

Bitter  as  was  the  Anglo-German  struggle  in  the  years 
before  1914,  there  was  real  co-operation.  Admitted  fact 
as  the  rivalry  between  English  and  German  trade  has  been 
for  years,  economic  links  bound  the  two  nations  so  strongly 
that  a  portion  of  the  British  public  neither  felt  nor  under- 
stood the  menace  of  Germany.  While  one  division  of  Brit- 
ish sentiment  was  opposing  the  passage  of  a  protective 
tariff,  another  was  demanding  it  to  safeguard  British  in- 
dustry from  German  "dumping."     While  half  of  Britain 


206  The  Economic  Causes  of  Modern  War 

could  not  sleep  o'  nights  for  fear  of  German  dreadnaughts, 
the  other  half  was  peacefully  consuming  the  very  goods 
which  those  dreadnaughts  were  built  to  protect  in  transit. 
For  German  "dumping"  would  never  have  been  possible 
had  British  citizens  refused  to  buy.  That  they  did  not 
refuse  to  buy  is  best  shown  by  the  results  of  the  British 
and  French  laws  requiring  the  "Made  in  Germany"  stamp 
on  all  German  goods.  Intended  to  check  German  trade 
by  warning  the  consumer  that  he  was  not  patronizing  home 
industries,  the  stamp  became  instead  the  best  advertise- 
ment of  the  German  manufacturers.  Industrialism  was 
producing  a  world-wide  contradiction.  It  was  creating  in- 
ternationalism and  international  war  at  the  same  time. 

One  other  illustration  of  this  paradox  is  to  be  seen  in 
the  organization  of  the  working  class.  The  rise  of  indus- 
trialism has  produced  simultaneously  an  incentive  to  a  new 
type  of  internationalism  and  an  incentive  to  a  new  type  of 
war.  International  organization  of  the  workers  has  roused 
both  a  class  consciousness  that  ignores  frontiers,  and  the 
advocacy  of  a  war  between  classes.  The  Internationale, 
created  by  an  industrial  proletariat,  has  gone  a  long  way 
since  the  days  of  Karl  Marx,  Friedrich  Engels,  and  the 
Communist  Manifesto,  with  its  plea,  "Workers  of  the 
world,  unite." 

The  workers  of  the  world  have  united,  or  at  least  they 
are  uniting;  and  they  are  developing  among  themselves  the 
"international  mind."  Thoroughly  devoted  to  the  princi- 
ple that  at  the  root  of  all  wars  lie  the  interests  of  the  capi- 
talists of  the  various  countries  (a  class  which  they  regard 
as  leagued  in  an  international  community  of  interests), 
the  leaders  of  the  radical  wing  of  labor  before  the  war 
sought  their  own  union  in  the  Internationale  which,  with 
its  headquarters  at  Brussels,  had  been  organized  and  active 
for  more  than  half  a  century. 


Internationalism  and  Economic  Conflict  207 

International  finance  and  international  working-class  or- 
ganization are  two  conflicting  forces  to  which  nationality 
is  coming  to  mean  less  and  less.  They  both  make  for  in- 
ternational solidarity.  But  finance  may  stimulate  (as  well 
as  prevent)  wars  between  states;  and  the  leaders  of  the 
Internationale  have  not  hesitated  to  preach  another  kind 
of  war — not  between  states,  but  between  classes.  The  at- 
tempt of  German  and  French  socialists  to  stop  the  war  in 
1914,  failure  though  it  was,  has  an  enormous  future  sig- 
nificance. 

The  interest  of  the  wage-earner  in  internationalist  or- 
ganization is  very  large.  From  the  workers  come  the  rank 
and  file  of  armies,  who  endure  a  maximum  of  the  misery 
and  enjoy  a  minimum  of  the  glory  and  profit  of  war.  Only 
through  the  indirect  and  not  always  apparent  channel  of 
extension  of  the  national  industry,  does  the  worker  profit, 
if  he  profits  at  all,  from  the  wars  of  economic  rivalry. 
Hence  the  growth  of  the  international  movement  among 
the  working  classes  in  recent  years;  and  hence  the  efforts 
of  French  and  German  socialists  to  prevent  the  outbreak  of 
the  World  War — an  effort  which  is  pregnant  with  future 
possibilities. 

That  the  tendency  toward  international  solidarity  which 
economic  and  financial  inter-relationship  and  the  scien- 
tific and  artistic  community  of  tastes  and  interests  through- 
out the  world  produces,  has  not  prevented  wars;  and  that 
international  economic  rivalry  has  been  productive  of  so 
many  wars,  suggests  a  comparison  of  economic  rivalry  be- 
tween states,  with  economic  rivalry  within  the  state  itself. 
Why  have  most  individual  nations  developed  to  the  point 
where  their  cohesive  forces  are  sufficient  to  prevent  civil 
war?     Why  has  internationalism  never  developed  to  the 


208  The  Economic  Causes  of  Modern  War 

place  where  it  can  accomplish  the  same  thing  in  interna- 
tional relations? 

In  any  state,  internal  commercial  rivalries  exist  which 
are  analogous  to  the  larger  economic  conflicts  of  the  world 
powers.  In  the  larger  political  organisms  of  the  world, 
in  states  like  the  British  Empire  or  even  the  United  States, 
internal  economic  rivalries  may  exist  to  a  very  consider- 
able degree.  The  tariff  laws  of  the  British  dominions  or 
the  tariff  wars  that  raged  among  the  American  states  prior 
to  the  formation  of  the  Union,  are  sufficient  demonstra- 
tion of  the  fact.  Sometimes,  as  in  the  United  States,  un- 
derlying economic  causes  may  lead  to  civil  war;  but  these 
cases  are  rare  in  the  modern  world.  There  are  not  many 
civil  wars,  whereas  since  1878  there  have  been  only  four 
years  when  the  world  was  wholly  free  from  international 
struggle.  Why  do  international  economic  rivalries  lead  to 
war,  in  spite  of  the  strong  international  solidarity  that  has 
gradually  grown  up  in  Europe  and  the  world  at  large, 
whilst  only  occasionally  do  economic  difficulties  within  na- 
tions lead  to  civil  war? 

The  answer  is  to  be  found  in  the  tradition,  of  very  re- 
cent origin,  sanctioning  the  intervention  of  diplomats,  sup- 
ported by  the  armed  power  of  their  states,  in  the  economic 
interests  of  their  nationals.  The  commercial  attache,  that 
curious  link  between  the  consular  and  diplomatic  services, 
is  a  newcomer  in  the  embassies.  Commercial  rivalry  has 
not  been  left  upon  an  entirely  economic  basis ;  but  political 
power  has  been  thrown  into  the  scale  to  help  the  economic 
interests  of  the  fatherland  where  competition  was  prov- 
ing too  much  for  its  merchants.  Within  states  there  is  no 
such  governmental  effort  to  secure  "special  interests"  and 
"legitimate  aspirations."  Massachusetts  does  not  seek  to 
assure  supply  of  raw  materials  to  her  textile  mills  by 


Internationalism  and  Economic  Conflict  209 

threatening  to  use  her  militia  to  secure  an  exclusive  "sphere 
of  influence"  in  the  cotton  fields  of  Georgia. 

Not  only  has  trade  followed  the  flag;  but  on  a  good 
many  occasions  the  flag  has  gone  post-haste  to  the  rescue 
when  trade  has  found  itself  in  difficulty.  Great  Britain  had 
forty  per  cent,  of  the  trade  of  Morocco ;  France  had  twenty ; 
Germany  had  nine; — the  Kaiser  sent  a  gunboat.  The  Turks 
in  Tripoli  hampered  Italian  commercial  penetration — the 
Italians  seized  Tripoli.  The  extension  of  Russian,  Ger- 
man, French,  and  British  commercial  interests  in  China 
was  not  left  to  the  individual  enterprise  of  the  merchants 
themselves.  Spheres  of  influence  were  demanded,  and  gov- 
ernmental assistance  was  granted  them. 

The  intervention  in  Egypt  was  largely  a  matter  of  help- 
ing out  European  investors  who  had  made  a  bad  bargain. 
If  the  same  investors  had  bought  wild-cat  mining  stock  in 
the  United  States  there  would  have  been  no  intervention, 
any  more  than  there  was  intervention  when  the  Volstead 
Act  rendered  valueless  the  very  considerable  European 
holdings  of  stock  in  American  brewing  companies.  But 
when  the  Khedive's  creditors  lost,  after  having  loaned  to  a 
backward  and  notoriously  unbusinesslike  native  adminis- 
tration, they  appealed  to  their  governments. 

Protection  of  nationals  whose  properties  are  threatened 
by  disorder  in  the  backward  states  in  which  they  have  in- 
vested (the  sort  of  thing  that  the  United  States  has  re- 
peatedly done  in  the  smaller  countries  of  South  America) 
is  much  the  same.  Intervention  of  this  kind,  ostensibly 
necessary,  has  led  often  in  the  past  to  attempts  at  per- 
manent occupation,  which  rouse  the  jealousy  of  other 
Powers,  economic  rivals  of  the  occupying  Power,  and  lead 
on  to  eventual  hostilities. 

There  is  good  reason  for  questioning  the  ultimate  value 
of  such  interference  by  governments.     Certainly  the  peace 


210  The  Economic  Causes  of  Modern  War 

of  the  world  would  have  been  served  if  the  financiers  of 
European  countries  had  been  given  to  understand  long 
since  that  their  bad  investments  would  not  be  recouped 
by  their  countries'  armies  and  navies.  It  remains  to  be 
shown  that  economic  progress  would  not  have  gone  on  at 
the  same  rate  if  the  merchants  who  aspired  to  trade  con- 
cessions in  undeveloped  quarters  of  the  globe  had  been  per- 
mitted to  take  their  own  risks  and  win  their  own  profits 
or  losses  in  free  competition  with  their  natural  rivals  from 
other  states,  without  placing  themselves  under  the  pro- 
tection of  their  governments. 

Perhaps  the  development  of  such  backward  lands  as 
China  or  of  savage  lands  like  the  African  territories,  might 
not  have  proceeded  under  these  conditions.  There  might, 
indeed,  have  been  anti-foreign  risings  which  would  have 
led  to  massacres  so  appalling  that  armed  intervention  would 
have  been  necessary.  The  observed  historic  fact  remains 
that  where  native  risings  have  occurred  (the  Boxer  Re- 
bellion is  a  standing  example)  they  have  been  caused  by 
the  intolerable  demands  of  foreign  states  and  not  by  the 
mere  presence  of  foreign  merchants. 

Japan,  it  is  true,  was  opened  to  the  western  world  by 
force;  but  it  is  a  noteworthy  fact  that  Japan,  having  by 
force  been  able  to  defend  her  national  integrity,  has  made 
more  progress,  economic,  social,  political,  and  intellectual, 
than  any  of  the  districts  of  the  world  which  have  been 
farmed  out  as  "concessions"  or  "spheres  of  influence." 

There  is  no  denying  that  where  economic  rivalry  has 
been  inimical  to  the  spirit  of  internationalism,  that  condi- 
tion has  usually  arisen  through  the  rivalries  of  governments 
over  economic  questions  rather  than  through  the  rivalries 
of  individual  merchants  or  corporations  unassisted. 

The  trade  rivalries  of  Germany  and  England  on  the  Con- 
tinent and  in  their  interchange  of  products,  it  is  also  true, 


Internationalism  and  Economic  Conflict  211 

contributed  to  war;  but  they  were  only  a  small  part  of  the 
causation  of  the  war  and  they  stirred  up  ill-feeling  only 
in  portions  of  both  populations.  German  aggression  in 
Africa,  China,  the  Balkans — the  result  of  political  and  dip- 
lomatic exertions  on  behalf  of  German  merchants  and  in- 
dustries^— stirred  the  whole  British  public.  The  commer- 
cial rivalries  of  Germany  and  France  on  the  Continent  had 
little  governmental  recognition,  and  they  led  to  compara- 
tively little  ill-feeling.  The  Moroccan  difficulties  stirred 
the  whole  populations  of  both  states. 

If  political  interference  in  economic  conflicts  could  be 
prevented  or  limited,  the  checking  of  internationalism 
would  be  correspondingly  prevented  or  limited;  and  the 
natural  trend  to  solidarity  between  the  nations  because  of 
their  growing  economic  ties,  ready  communication,  and 
their  intellectual  and  artistic  community,  would  be  given 
freer  play  for  the  binding  together  of  all  peoples. 


CHAPTER  VII 

THE    LEAGUE   OF    NATIONS 

The  principal  economic  cause  of  war  is  the  interde- 
pendence of  nations  without  guarantee  of  security  save  by 
their  own  armed  strength.  Almost  every  state  in  the  mod- 
ern world  is  completely  dependent  upon  other  states  or 
upon  colonies  overseas  for  some  commodity  which  is  ab- 
solutely essential  for  its  life,  yet  which  may  be  cut  off  at 
any  time  by  military  or  naval  reverses  in  the  event  of  war. 

Every  nation  in  Europe,  as  we  have  seen,  must  look  out- 
side its  own  boundaries  for  a  large  proportion  of  its  food 
supply,  for  its  markets,  and  for  the  raw  materials  with- 
out which  its  industries  cease  and  its  population  starves. 
Germany  and  England  look  to  the  United  States  for  cot- 
ton. Both  states  look  abroad  for  large  parts  of  their  sup- 
plies of  other  raw  materials.  France  imports  huge  quan- 
tities; and  the  absolute  dependence  of  small  manufactur- 
ing states  like  Belgium  is  abject. 

The  food  situation  has  been  much  the  same  in  all  Euro- 
pean states.  The  United  Kingdom  had  for  a  hundred 
years  been  only  a  few  weeks  ahead  of  starvation,  hopelessly 
and  helplessly  dependent  upon  the  ships  which  from  the 
ultimate  ends  of  the  earth  bring  in  her  foodstuffs.  Be- 
fore the  war  Germany  had  to  import  16  per  cent,  of  her 
grain  consumption  and  the  importations  of  the  smaller 
states  were  proportionately  much  larger.  The  Swiss  nor- 
mally imported  78  per  cent,  of  their  grain,  the  Dutch  66 
per  cent.,  the  Norwegians  65  per  cent.,  the  Danes  28  per 
cent,  and  the  Swedes  14  per  cent.     Even  the  rich  soil  of 

212 


The  League  of  Nations  213 

Spain  was  insufficient  to  meet  the  needs  of  the  people.1 
Any  state  with  military  or  naval  power  sufficient  to  cut  the 
trade  routes  may  starve  its  neighbors  at  will. 

That  modern  states  should  be  dependent  upon  the  whims 
of  their  neighbors  for  the  prosperity  and  happiness,  even 
for  the  safety  of  their  citizens,  is  an  intolerable  condition, 
which  none  the  less  existed  at  the  outbreak  of  the  World 
War  in  every  European  nation,  and  which  exists  today. 

Instances  are  not  far  to  seek.  The  Austrian  attempt  to 
ruin  the  farmers  of  Serbia  by  closing  the  frontier  to  their 
pigs,  is  a  single  grotesque  but  striking  example.2  The 
misery  caused  among  the  textile  workers  of  England  when 
the  American  Civil  War  cut  off  the  cotton  supply  and 
forced  the  closing  of  the  mills,  is  another;  and  in  this 
case  the  economic  pressure  became  so  severe  that  it  very 
nearly  led  to  British  intervention  on  behalf  of  the  South- 
ern States. 

The  subsequent  British  attempt  to  encourage  cotton 
growing  within  the  imperial  dominions  is  a  striking  ex- 
ample of  the  effort  of  a  state  which  finds  its  dependence 
on  other  nations  too  dangerous  to  be  endured,  to  become 
economically  self-sufficing.  The  seriousness  with  which  the 
British  recognized  the  menace  to  their  textile  industry  of 
its  reliance  upon  American  cotton,  is  to  be  seen  in  the 
speech  from  the  throne  of  Edward  VII,  February  2,  1904. 
The  King  said: 

'The  insufficiency  of  the  raw  materials  upon  which  the  great 
cotton  industry  of  this  country  depends,  has  inspired  me  with 
great  concern.  I  trust  that  the  efforts  which  are  being  made 
in  various  parts  of  my  Empire  to  increase  the  area  under  culti- 
vation may  be  attended  with  a  large  measure  of  success." 

'Sir  George  Paish:  A  Permanent  League  of  Nations,  pp.  62  and  75. 
2  See  p.  173. 


214  The  Economic  Causes  of  Modern  War 

The  efforts  to  remedy  the  dependent  condition  of  the 
cotton  industry  have  been  successful  to  the  extent  of  in- 
creasing the  proportion  of  the  cotton  used  by  English  tex- 
tile mills  grown  within  the  borders  of  the  Empire  to  a  very 
considerable  extent;  but  stiU  11,000,000  of  the  16,000,000 
bales  of  cotton  consumed  annually  come  from  the  United 
States.1  The  degree  of  dependence  upon  the  United  States 
is  still  disquieting,  and  only  the  navy  provides  a  security 
which  in  these  days  of  invention  and  in  view  of  the  prob- 
able future  development  of  the  use  of  aircraft  in  war,  is 
more  tenuous  than  a  naval  power  cares  to  admit. 

Other  examples  might  be  multiplied  without  end.  Per- 
haps the  most  striking  evidence  of  the  interdependence  of 
nations  ana  tne  imperative  necessity  of  providing  security 
of  some  kind,  may  be  seen  in  the  suffering  caused  in  the 
South  in  1914  when  the  war  prevented  the  export  of 
American  cotton  to  the  German  market,  enabling  the 
British  to  buy  what  they  needed  at  depressed  prices,  with 
results  very  similar  to  those  in  England  during  the  Civil 
War.  As  Englishmen  had  suffered  in  one  great  war  be- 
cause they  could  not  buy  cotton,  so  Americans  suffered  in 
another  and  a  greater  because  they  could  not  sell  it.  As 
England  had  then  proposed  to  resort  to  force,  so  now  Gov- 
ernor Colquitt,  of  Texas,  in  a  fiery  outburst,  proposed  send- 
ing "American  ironclads  to  England's  door,"  to  enforce  the 
rights  of  the  cotton-growers  of  the  United  States. 

In  all  these  instances  the  situation  is  the  same.  Nations 
are  vitally  interwoven,  one  with  the  other.  Almost  any 
state  can  strike  directly  at  the  economic  interests  of  any 
other — interests  so  important  that  serious  interference  with 
them  produces  nation-wide  calamity.  No  agency  exists 
to  guarantee  security  against  these  occurrences  at  any 
time;  and  the  nations  of  the  world,  unwilling  to  endure  so 

XJ.  Arthur  Hutton:    The  Cotton  Crisis,  p.  12. 


The  League  of  Nations  215 

perilous  a  condition,  resort  to  armaments  to  provide,  by 
their  own  individual  strength,  such  security  as  is  possible. 
At  the  same  time,  they  seek  to  acquire  undeveloped  terri- 
tory to  supply  their  needs;  and  in  their  efforts  come  into 
conflict.  The  train  of  miseries  that  the  World  War  brought 
with  it  shows  how  little  this  method  avails. 

Interdependence  is  not  in  itself  a  cause  of  conflict.  It  is, 
on  the  contrary,  as  has  been  shown  in  the  preceding  chapter, 
the  true  cause  for  much  of  the  progress  already  made  in 
international  co-operation.  If  the  insecurity  of  the  supply 
of  commodities  necessary  to  an  industrial  state  can  be 
removed,  the  interdependence  of  the  states  is  the  best  pos- 
sible link  to  bind  them  together.  But  security  is  indispen- 
sable. How  is  security  to  be  assured,  and  the  economic  in- 
terdependence necessary  to  a  complex  civilization  left  to 
proceed  naturally,  becoming  in  the  end  a  device  for  the 
preservation  of  peace? 

It  must  be  remembered  in  the  first  place  that  economic 
rivalry  need  not  lead  to  the  type  of  political  rivalry  which 
has  found  expression  in  the  colonization  and  quarrels  of 
the  last  fifty  years.  Except  for  the  desire  to  keep  its  citi- 
zens under  its  own  flag,  a  state  has  no  need  for  seeking 
colonies,  providing  i\vat  the  steady  inflow  of  raw  materials 
and  food,  and  the  permanent  accessibility  of  markets  are 
assured. 

But  if  free  exports  and  imports  are  not  assured,  an  indus- 
trial state  must,  under  the  pressure  of  an  iron  necessity, 
seek  to  obtain  colonies  and  strategic  possessions  on  sea  lanes 
and  trade  routes  by  land,  in  order  to  provide  for  its  own 
safety.  But  granted  this  freedom  of  importation  and  ex- 
portation, the  chain  of  war-causes — over-population,  pro- 
duction beyond  the  capacity  of  the  domestic  market,  food 
shortage,  and  lack  of  raw  materials — which  has  been  almost 
inevitable  in  modern  Europe,  ceases  to  be  a  danger.    The 


216  The  Economic  Causes  of  Modern  War 

fear  of  excessive  production  ends  when  free  access — not  to 
the  home  markets  of  competing  industrial  states,  perhaps. — 
but  to  the  colonial  markets  of  the  world,  is  offered  to  the 
merchants  of  every  nation,  subject  to  no  restriction  save 
their  own  commercial  capacity  and  skill.  The  danger  of 
food  shortage,  similarly,  vanishes  when  the  highways  of  the 
world  are  kept  open  by  a  power  capable  of  crushing  any 
single  nation  that  ventures  to  interfere  with  their  freedom. 
The  lack  of  raw  materials  ceases  to  be  a  menace  for  the  same 
reason  and  under  the  same  conditions. 

A  fact  which  must  be  kept  in  mind  always  is  that  the 
wars  which  have  broken  out  as  a  result  of  economic  rivalry, 
have  arisen  from  competition  for  trade  or  colonies  or  conces- 
sions in  the  politically  backward  portions  of  the  earth. 
Germany  and  England  met  in  competition  in  European  as 
well  as  in  colonial  markets,  and  (although  it  is  admitted 
that  this  rivalry  contributed  to  ill  feeling  and  helped  cause 
hostilities)  it  is  quite  evident  that  it  was  not  this  purely 
trade  competition  (unaided  by  diplomacy  or  naval  and 
military  demonstrations)  that  produced  the  war.  The 
kind  of  economic  rivalry  which  menaces  peace  is  that 
which  grows  up  as  the  nations  compete  with  one  another 
in  the  more  remote  or  undeveloped  corners  of  the  earth, 
railways  in  Asia  Minor,  lumber  on  the  Yalu,  the  fertile 
Yangtse  valley,  Egypt,  Morocco,  and  the  Balkans. 

Except  for  iron  and  coal,  Europe  in  general  looks  to  these 
undeveloped  countries  for  all  its  raw  materials  and  food. 
European  Powers  are  not  very  fearful  of  possible  hindrance 
to  export  or  import  among  themselves;  for,  large  as  these 
exchanges  may  be  in  bulk  and  important  as  they  may  be 
financially,  they  are  not  so  important  to  livelihood  as  are 
the  raw  materials  and  the  food  brought  from  the  far-off, 
unprogressive  lands,  where  the  war  that  halted  European 
progress  was  bred. 


The  League  of  Nations  217 

If  a  condition  could  be  brought  about  throughout  the 
globe  in  which  industry  were  at  all  times  certain  of  free 
access  to  supplies  of  the  all-important  raw  materials  and 
at  the  same  time  assured  of  adequate  markets,  most  inter- 
national friction  would  disappear.  Such  a  condition  does 
not  demand  the  adoption  of  universal  free  trade  by  any 
means,  but  it  does  require  the  elimination  of  protective 
tariffs  except  for  the  development  of  home  industries,  and 
the  total  abolition  of  exclusive  colonial  tariffs.1  General 
concession  of  most  favored  nation  treatment  in  colonies 
is  essential. 

Suppose  that  an  organization  had  existed  during  the 
last  fifty  years  sufficiently  powerful  to  provide  Great  Britain, 
Germany,   France,   Japan,   and   Russia   with    trustworthy 

1  It  is  by  no  means  demonstrated,  of  course,  that  free  trade  (to  which 
Cobden  referred  as  "the  best  human  means  for  ensuring  real  and  enduring 
peace")  would  actually  do  all  that  has  been  claimed  for  it.  At  the  same 
time,  it  would  certainly  lead  to  an  enormous  reduction  of  the  rivalry  and 
friction  from  which  war  grows,  if  applied  to  colonies.  From  two  sources 
so  widely  removed  from  one  another  as  Lord  Cromer  and  the  Fabian 
Society,  I  take  the  following  opinions: 

"No  experience  has,  therefore,  as  yet  been  acquired,  which  would  en- 
able a  matured  judgment  to  be  formed  as  to  the  extent  to  which  Free 
Trade  may  be  regarded  as  a  preventive  to  war.  .  .  .  All  that  has 
been  proved  is  that  numerous  wars  have  taken  place  during  a  period  of 
history  when  Protection  was  the  rule  and  Free  Trade  the  exception; 
though  the  post  hoc  ergo  propter  hoc  fallacy  would,  of  course,  be  involved, 
if  on  that  account  it  were  inferred  that  the  protection  of  national  indus- 
tries has  necessarily  been  the  chief  cause  of  war.  .  .  . 

"Whereas  exclusive  trade  tends  to  exacerbate  international  relations, 
Free  Trade,  by  mutually  enlisting  a  number  of  influential  material  in- 
terests in  the  cause  of  peace,  tends  to  ameliorate  those  relations,  and 
thus,  pro  tanto,  to  diminish  the  probability  of  war." — E.  B.  Cromer: 
"Free  Trade  in  Relation  to  Peace  and  War,"  The  Nineteenth  Century  and 
After:  68:384-87,  S.,  '10. 

With  especial  reference  to  colonial  questions,  Mr.  L.  S.  Woolf  sums  this 
attitude  up  succinctly:  "With  free  access  to  the  flags  of  all  nations, 
with  complete  liberty  of  commerce,  with  no  concessions  of  commercial 
monopolies  and  privileges,  we  should  hear  less  of  Far  Eastern  Questions, 
of  the  partition  of  China  of  Persia  and  Bagdad  and  Morocco."  L.  S. 
Woolf,  International  Government,  p.  28. 


218  The  Economic  Causes  of  Modern  War 

guarantee  of  a  steady  supply  of  the  raw  materials  that  their 
industries  required,  of  sufficient  food  for  their  populations, 
and  of  access,  with  free  competition,  to  the  markets  of  all 
colonies,  with  sea  lanes  and  land  routes  permanently  open, 
unhampered  by  diplomatic  or  political  interference,  or 
force  of  any  kind. 

Even  such  a  guarantee  might  not  have  eliminated  some 
points  of  international  friction.  There  is  no  reason  to 
doubt  that  the  successful  exploits  of  the  German  in  "dump- 
ing" would  have  led  to  resentment.  But  all  over  the  world 
there  would  have  been  a  lessening  in  tension  in  the  inter- 
national situation  because  of  the  absence  of  the  fear  and  sus- 
picion produced  by  years  of  colonial  rivalry  and  reinforced 
by  incident  after  incident,  year  after  year,  until  the  nations 
were  ready  for  war  upon  trifling  provocation  because  of 
rivalries  whose  economic  origin  the  popular  mind  had  all 
but  forgotten. 

Given  guarantees  of  raw  materials,  food  supplies,  and 
open  markets,  the  world  might  have  been  spared  the  whole 
sorry  business  in  the  Far  East.  The  policy  of  the  open  door 
would  have  obtained,  and  neither  Russia  nor  Japan  would 
have  needed  hegemony  in  the  military  or  naval  sphere  in 
order  that  her  merchants  might  carry  on  trade.  In  the 
Near  East,  with  the  security  of  the  trade  routes  and  sea 
lanes  already  guaranteed,  the  fear  of  the  British  for  India 
would  have  disappeared,  and  with  it  a  century  of  struggle. 
The  suspicions  of  the  other  nations  would  have  decreased; 
and  at  least  the  political  results  of  their  economic  rivalry 
in  Asia  Minor  would  have  ceased.  The  contest  for  the 
market  which  followed  would  have  been  merely  a  struggle 
between  business  men,  without  diplomatic  interference,  of 
the  sort  that  goes  on  within  all  states  among  native  mer- 
chants. 

Guarantees  of  trade  routes  would  have  done  away  with 


The  League  of  Nations  219 

half  the  danger  of  the  Bagdad  Railway,  from  either  military 
or  economic  reasons,  and  the  projected  road  might  have 
become  a  business  enterprise  of  great  value  to  all  the 
nations. 

In  the  Balkans,  guarantees  of  access  to  the  sea  would 
have  reduced  friction  and  altered  the  situation  entirely. 
The  friction  in  Persia  and  Morocco  would  have  disappeared, 
as  would  also  the  scramble  for  naval  bases,  for  the  protec- 
tion of  sea-borne  commerce  would  no  longer  devolve  upon 
the  various  states,  since  the  security  of  the  sea  lanes  would 
be  certain. 

It  must  be  remembered  that  in  international  politics 
the  starkly  economic  motive  is  likely  to  be  glossed  over 
with  finer-sounding  phrases.  A  large  proportion  of  the 
international  crises,  therefore,  in  which  the  "national  hon- 
or has  been  affronted,  or  the  "legitimate  aspirations" 
thwarted,  are  at  bottom  economic,  and  the  conflicts  which 
result  are  really  disguised  economic  rivalries.  Most  of  the 
wars  and  threats  of  war  which  arise  ostensibly  as  the  results 
of  causes  other  than  the  economic,  are  actually  of  such  ori- 
gin that  they  vanish  once  economic  security  is  permanently 
won. 

The  interdependence  of  the  nations  of  the  world  has 
become  a  commonplace;  but  obvious  as  this  fact  is,  its 
equally  important  corollary  is  likely  to  escape  attention. 
Unless  guarantees  can  be  provided  for  every  nation,  that 
nothing  save  its  own  ill-doing  will  interfere  with  the  free 
flow  of  supplies  upon  which  its  very  life  depends,  the  states 
will  continue  to  plot  to  provide  this  security  for  them- 
selves, and  the  rivalry  thus  engendered  over  the  portions 
of  the  earth  unoccupied  by  civilized  peoples  will  lead 
always  to  arbitration  by  artillery. 

The  narrow  margin  of  failure  of  the  German  submarine 


220  The  Economic  Causes  of  Modern  War 

campaign  against  England  indicates  still  more.  It  shows 
that  even  a  powerful  Empire  (which  has  a  partial  economic 
independence  of  the  rest  of  the  world)  is  still  far  from  com- 
plete security.  For  though  it  can  withdraw  with  measurable 
success  from  dependence  on  the  rest  of  the  world,  it  must 
suffer  as  bitterly  as  any  other  if  its  enemies  are  able  to 
interfere  with  its  lines  of  transport. 

Recent  developments  of  aerial  warfare  teach  that  in 
the  future  such  interference  with  railway  communication 
will  probably  become  as  easy  a  matter,  even  in  uninvaded 
country,  as  interference  has  hitherto  been  by  sea.  The 
bare  degree  of  security  that  has  existed  by  virtue  of  the 
might  of  individual  nations  is  still  further  diminished,  and 
the  problem  of  providing  a  sufficient  guarantee  of  economic 
security  to  all  nations  is  further  complicated. 

The  existing  order  of  international  interdependence  with- 
out security  means  nervousness  among  statesmen,  bitter 
economic  hostility,  out  of  which  come  distrust,  fear,  sus- 
picion, the  scramble  for  colonies,  and  spheres  of  influence, 
and  the  whole  miserable  business  that  breeds  war.  So 
long  as  nations  are  dependent  one  upon  another  and  yet  are 
not  secure  in  that  inevitable  relation,  war  will  continue. 

It  is  clear  that  interdependence,  even  if  it  could  be 
reduced,  can  never  be  done  away  with  so  far  as  such  raw 
materials  as  minerals,  lumber,  wool,  cotton,  and  the  like, 
or  so  far  as  food  supplies  are  concerned.  The  alternatives 
are :  either  to  become  reconciled  to  the  continuance  of  wars, 
growing  more  and  more  destructive  and  wasteful  as  science 
advances;  or  else  to  provide  an  agency  capable  of  offering 
security — at  least  such  an  approximation  that  the  nations 
may  reasonably  yield  it  a  fair  degree  of  reliance. 

The  peace  problem,  as  the  destructiveness  of  war  in- 
creases, is  rapidly  becoming  something  more  than  a  mere 
question  of  ameliorating  the  lot  of  the  race.    It  is  a  prob- 


The  League  of  Nations  221 

lem  of  racial  survival.  The  wars  of  the  last  hundred  years 
have  been  deadly,  destructive,  and  wasteful  enough ;  but  the 
World  War  involved  the  whole  race.  There  is  prospect 
of  the  future  application  to  warfare  of  still  more  efficient 
aircraft,  of  new  chemical  devices,  and  of  the  possibility  of 
spreading  disease  among  armies  and  civilian  populations 
by  means  of  bacteria.  The  continuance  of  wars  and  the 
continuance  of  the  race  are  incompatible.  Either  we  must 
find  a  way  to  stop  killing  each  other,  or  there  will  speedily 
be  none  of  us  left  to  kill. 

In  other  words,  it  is  imperative  that  a  mechanism  of 
some  kind  be  devised  for  assuring  to  every  nation  which  is 
in  any  vital  respect  dependent  on  another  or  on  colonies, 
that  the  freedom  of  import  and  export  will  never  be  denied 
it.  Such  a  step  would  put  an  end  to  economic  rivalry  be- 
tween states,  and  leave  merely  the  legitimate  competition 
of  individual  business  men. 

If  there  is  to  be  a  League  of  Nations,  it  must  have  an 
extended  economic  program  and  the  force  to  assure  that 
it  will  be  respected.  If  we  are  not  to  have  a  political 
League  of  Nations,  at  least  there  must  be  a  board  of  inter- 
national economic  control  of  some  sort  which  will  do  away 
with  the  economic  conflict  of  the  sort  that  the  last  fifty 
years  have  seen.  The  world  is  now  an  economic  unit  with 
interests  of  which  no  part  can  be  considered  separately 
from  any  other;  and  all  the  logic  of  history  and  evolution 
points  to  a  closer  and  closer  interweaving  of  these  interests. 
Economics  long  ago  overstepped  political  frontiers. 

The  whole  problem  of  economic  rivalry  and  the  wars  that 
it  produces  is  solved  when  security  is  assured  to  interde- 
pendent nations. 

It  is  evident  that  none  of  the  expedients  hitherto 
attempted  have  in  any  sense  solved  this  difficulty.    Neither 


222  The  Economic  Causes  oj  Modern  War 

the  Concert  of  Europe  nor  the  Balance  of  Power  has 
availed  to  prevent  war  after  war,  in  each  of  which  the 
economic  motive  has  appeared,  caused  by  the  inequitable 
conditions  which  lead  the  business  man  in  the  end  to  turn 
to  the  diplomat  and  the  soldier  for  aid  in  carrying  out  his 
purposes.  Only  an  international  organization  of  some  sort, 
a  very  powerful  organization,  can  provide  such  security  as 
has  been  indicated  in  the  preceding  paragraphs.  One 
thinks  naturally  of  the  League  of  Nations,  even  though  the 
Covenant  which  establishes  it  has  not  stressed  greatly  the 
economic  problems  that  the  future  international  relations 
will  involve.  The  League  is  the  only  agency  capable  of 
a  task  so  gigantic.  If  it  is  to  exist  at  all,  no  other  organ- 
ization can  attempt  to  render  this  service,  for  the  co- 
existence of  a  power  sufficient  to  guarantee  economic  se- 
curity would  menace  the  League  itself. 

The  practicability  of  such  an  international  economic 
union  as  is  postulated  in  proposals  for  free  access  to  all 
parts  of  the  colonial  world,  for  guarantee  of  food  supplies, 
for  raw  materials,  and  open  colonial  market,  has  already 
been  tested  in  practice  on  a  scale  almost  as  large  as  that 
proposed.  Not  all  the  nations  of  the  world,  it  is  true,  were 
in  the  economic  union  of  the  Allies,  but  certainly  fairly 
safe  deductions  can  be  made  from  a  co-operation  which 
involved  Great  Britain,  the  United  States,  France,  Italy, 
Japan,  and  the  smaller  Allied  Powers.  When  the  United 
States  entered  the  war,  the  economic  system  that  had  been 
begun  by  the  Allies  reached  a  culmination  such  as  had  never 
been  dreamed  of.  Embracing  two  hemispheres  and  most 
of  the  nations  of  the  globe,  it  was  more  powerful  than  any 
similar  organization  that  had  ever  existed  or  been  imagined. 
Food,  war  materiel,  the  raw  materials  of  industry,  trans- 
portation— all  came  under  the  control  of  this  gigantic  eco- 
nomic union. 


The  League  of  Nations  223 

The  economic  co-operation  of  the  Allied  Powers  amounted 
to  an  inter-continental  administration  which  held  dominion 
over  almost  all  the  commerce  of  the  world,  drawing  its  sup- 
plies, not  merely  for  military  purposes,  but  for  the  supply  of 
industry  and  the  food  of  the  civil  population,  from  every 
quarter  of  the  globe.  Nothing  like  it  had  ever  been  seen 
before.  Nothing  quite  like  it  had  ever  been  imagined. 
But  there  it  was,  and  during  the  last  part  of  the  war  it  did 
its  work  in  a  fashion  that,  while  battles  were  still  being 
fought,  pointed  the  way  to  their  prevention  in  the  future. 

The  economic  union  which  had  such  an  enormous  sig- 
nificance was  a  development  of  the  first  tentative  efforts 
towards  co-operation  that  began  as  soon  as  the  magnitude 
and  probable  duration  of  the  war  were  appreciated  by  the 
Allied  Governments.  The  Food  Control,  the  Inter-Allied 
Munitions  Council,  the  Inter-Allied  Maritime  Transport 
Council,  and  finally,  the  Program  Committees,  were  a  grad- 
ual growth,  and  when  the  war  finally  closed  they  were  at 
the  very  height  of  their  efficiency.  Had  the  war  gone  on 
a  little  longer  a  Raw  Materials  Council  would  undoubtedly 
have  been  added  to  the  others  to  deal  with  the  raw  ma- 
terials of  chief  importance  not  already  administered  by  the 
Munitions  Council,  notably  wool,  cotton,  hides,  leather, 
tobacco,  paper,  timber,  petroleum,  flax,  hemp,  jute,  coal  and 
coke. 

The  economic  organization  of  the  Allies  is  important 
because  it  offers  both  precedent  and  model  for  the  peace- 
time handling  of  the  same  problem.  The  Food  Control  took 
its  final  international  shape  in  1918,  when  the  Council  of 
Four  was  set  up.  This  body  included  the  four  Food  Con- 
trollers of  principal  importance,  namely,  those  of  the 
United  States,  Great  Britain,  France,  and  Italy.  In  1917 
a  scientific  commission  had  already  been  organized  to  find, 
if  possible,  methods  of  solving  the  food  problems  of  the 


224 


The  Economic  Causes  of  Modern  War 


Allies,  and  during  the  same  year  another  body  took  over  the 
control  of  meats  and  fats.  The  business  of  this  organization 
was  to  administer  the  buying  and  distribution  of  meats, 
butter,  cheese,  oils  and  fats  of  all  kinds,  and  canned  goods. 
A  wheat  executive  worked  in  America  through  two  agencies. 

The  vexing  problem  of  transport  was  handled  by  the 
Inter- Allied  Maritime  Transport  Council,  which  was  formed 
after  the  Paris  Conference  in  1917.  In  the  very  beginning, 
the  French  wished  to  make  of  this  a  paramount  economic 
body.  Through  the  nature  of  its  work,  it  came  in  the  end 
to  make  its  influence  felt  through  the  whole  organization 
of  the  Allies  and  to  become  almost  supreme. 

In  charge  of  each  of  the  twenty-one  chief  raw  materials 
was  a  Program  Committee,  by  which  the  varying  claims 
of  the  Allies  were  adjudged  and  a  division  made  of  the  com- 
mon stock,  so  far  as  it  would  go.  The  list  of  commodi- 
ties thus  administered  included:  1 


1.  Cereals 

2.  Oils  and  seeds 

3.  Sugar 

4.  Meats  and  fats 

5.  Nitrates 

6.  Aircraft 

7.  Chemicals 

8.  Explosives 

9.  Non-ferrous  metals 

10.  Mechanical  transport 

11.  Steel 

12.  Tin 

13.  Wool 

14.  Cotton 

15.  Hides  and  leather 

16.  Tobacco 

17.  Paper 
IS.  Timber 

19.  Petroleum 

20.  Flax,  hemp,  and  jute 

21.  Coal  and  coke 


Co-ordinated  by  the  Food  Control 


Co-ordinated  by  the  Munitions 
Council 


The  use  of  these  was  to  have  been 
co-ordinated  by  a  Raw  Materials 
Council 


'J.  L.  Garvin:  Economic  Foundations  of  Peace,  ch.  iv. 


The  League  of  Nations  225 

Because  a  Raw  Materials  Council  was  never  formally 
organized,  it  must  not  be  inferred  that  the  handling  of  the 
problem  of  the  international  distribution  of  these  commodi- 
ties was  not  in  all  respects  the  same  as  in  the  case  of  others. 
Many  raw  materials  were  already  being  administered  by 
the  Munitions  Council,  especially  metals  and  ores;  and  the 
military  authorities  of  the  various  nations,  of  course,  had  a 
great  deal  to  say  with  regard  to  the  distribution  of  wool, 
hemp,  flax,  hides,  and  tanning  materials,  which  were  of 
direct  concern  to  the  armies  in  the  field. 

Inadequate  as  such  an  outline  of  the  prodigious  task  of 
administering  the  economic  affairs  of  most  of  the  world 
during  the  most  trying  period  of  its  history  must  be,  it  is 
none  the  less  sufficient  to  indicate  the  nature  of  interna- 
tional economic  co-operation  in  time  of  peace.  The  two 
difficulties  of  food  supply  and  raw  materials,  which  are 
most  pressing  in  peace,  were  adjusted  with  a  minimum  of 
friction  amid  the  pressing  claims  of  many  nations  in  time 
of  war.  The  adjustment  was  made  by  the  Program  Com- 
mittees as  a  result  of  economic  study  of  the  previous  con- 
sumption of  each  country,  of  its  needs,  and  of  its  own 
capacity  for  producing  the  particular  commodity  in  question. 

This  task,  difficult  alike  because  of  its  greatness  and  the 
delicacy  of  the  questions  involved,  was  successfully  accom- 
plished with  administrative  machinery  which  had  to  be 
improvised  under  the  trying  conditions  of  war-time.  A 
more  completely  organized  economic  union  in  the  future, 
armed  with  like  plenary  powers  and  fuller  opportunities 
for  investigation,  should  be  able,  in  case  of  need,  to  adjudi- 
cate fully  and  justly  the  conflicting  claims  to  raw  materials 
and  to  food  supplies  of  various  countries. 

But  it  is  not  likely  that  so  complicated  a  machinery  will 


226  The  Economic  Causes  of  Modern  War 

be  required.  Freedom  of  access  to  all  countries  in  the  Far 
East,  the  Near  East,  and  in  Africa,  with  adequate  guaran- 
tees of  security  against  being  isolated  from  these  markets 
and  sources  of  supply  by  interference  with  transport,  will 
leave  these  matters  very  largely  to  the  adjustment  of  ordi- 
nary business  competition.  Under  these  conditions  inter- 
national economic  rivalry  need  no  more  lead  to  hostilities 
than  ordinary  competition  within  a  state  leads  to  war 
among  its  citizens. 

During  the  World  War  there  was  in  operation  on  a  prac- 
tical basis,  a  League  of  Nations  with  economic  as  well  as 
political  functions.  Military,  naval,  and  economic  power 
alike  were  wielded  by  the  League  of  the  Allies;  but  it  was 
only  because  of  the  economic  organization  that  the  success 
of  the  military  and  naval  power  was  possible. 

The  League  as  at  present  constituted  does  not  make  com- 
plete provision  for  even  an  approach  to  such  an  economic 
program,  but  it  does  take  the  necessary  first  step  toward 
such  a  policy.  'Tree  trade  spheres"  or  "spheres  of  equal 
opportunity"  have  not  been  created  in  the  colonial  storm 
centres,  nor  has  the  principle  of  the  open  door  in  China 
been  specifically  reasserted — measures  which  if  taken  would 
serve  at  once  to  reassure  all  the  industrial  nations,  large 
or  small,  that  are  haunted  with  the  perpetual  fear  of  find- 
ing the  world  closed  against  them.  The  freedom  of  the  seas 
has  not  been  won,  nor  have  merchant  vessels  been  placed 
on  the  same  footing  of  immunity  from  seizure  as  private 
property  on  land. 

The  protest  against  this  state  of  affairs,  coming  largely 
from  German  sources,  has  been  regarded  with  natural  dis- 
trust. Yet  the  protests  made  by  the  Germans  have  an 
element  of  truth  in  them;  and  they  express  what  many  of 
the  smaller  nations  think  and  keep  to  themselves.    A  para- 


The  League  of  Nations  227 

graph  from   Matthias   Erzberger's   book,    The   League   of 
Nations,  is  typical  of  this  group  of  complaints:  x 

"The  sovereignty  of  one  Power  or  group  of  Powers  over  the 
great  trade  routes  of  the  ocean  cannot  be  reconciled  with  the 
equal  privileges  of  all  nations.  ...  If  violence  is  to  be  banished 
from  international  life,  one  nation  alone  must  not  possess  the 
means  of  enforcing  its  will,  as  represented  by  the  possession  of 
all  the  straits  and  coaling  stations,  and  their  protection  by 
means  of  warships.  The  seas  must  be  free.  They  should  belong 
to  all  the  nations  in  equal  measure." 

In  another  passage  the  author  returns  to  the  same 
theme:2 

"So  long  as  the  sea-power  of  one  nation  exceeds  the  sea-power 
of  every  other  nation,  so  long  as  one  nation  holds  in  her  hands 
all  the  important  straits  and  sea  routes,  so  long  as  one  nation 
possesses  practically  all  the  coaling  stations  on  the  great  trade 
routes,  so  long  will  there  exist  a  menace  to  all  other  nations. 
Even  if  the  menace  is  not  operative  in  time  of  peace,  it  is,  merely 
by  the  fact  of  the  existence  of  the  military  resources  from  which 
it  arises,  a  latent  political  power  which  is  contrary  to  the  sense 
of  international  equality  of  rights  at  sea,  arouses  distrust,  and 
poisons  the  political  atmosphere." 

The  tone  of  these  complaints  is  perfectly  familiar;  and 
the  important  thing  about  them  is  that  very  familiarity. 
These  are  exactly  the  same  things  that  the  Germans  said 
before  the  war.  The  menace  to  sea  routes  and  therefore  to 
industry  brought  about  the  building  of  the  German  fleet 
and  was  one  of  the  important  underlying  causes  of  the 
World  War.  Herr  Erzberger's  book,  however,  has  appeared 
since  peace  was  made,  a  circumstance  which  is  a  reminder 
that  nothing  has  been  done  to  remove  this  danger  to  the 

'Matthias  Erzberger:    The  League  of  Nations,  p.  161.     I  have  omitted 
italics  in  some  places. 
'Ibid.,  p.  216. 


228  The  Economic  Causes  of  Modern  War 

peace  of  the  world.  Untaught  by  the  evils  from  which  we 
have  but  now  emerged,  we  are  going  blindly  onward  in  the 
old  path.  A  complete  guarantee  by  the  League  of  all 
trade  routes,  both  by  land  and  sea,  joined  with  immediate 
access  to  colonial  markets  and  raw  materials,  would  cer- 
tainly go  a  long  way  toward  assuring  permanent  peace. 

The  extent  to  which  the  League  of  Nations  does  make 
provision  for  economic  readjustment  with  a  view  to  the 
reduction  of  hostility  is  very  slight,  even  though  it  offers 
hope  for  future  development.  Among  the  six  bodies  which 
carry  on  its  business,  there  is  none  that  is  specifically  eco- 
nomic in  its  functions.  With  the  possible  exception  of 
Mandataries  and  the  Mandatary  Commission,  none  of 
these  six  bodies,  the  Executive  Council,  the  Body  of  Dele- 
gates, the  Military  and  Naval  Commission,  the  Bureau  of 
Labor,  the  Mandatary  Commission,  and  the  Permanent 
Secretariat  have  any  power  whatever  to  deal  with  the  most 
important  group  of  international  questions. 

In  the  Covenant  of  the  League  only  three  articles  even 
touch  economic  questions.    These  are: 

ARTICLE  XVI 

"Should  any  of  the  High  Contracting  Parties  break  or  dis- 
regard its  covenants  under  Article  XII,  it  shall  thereby,  ipso 
facto,  be  deemed  to  have  committed  an  act  of  war  against  all 
the  other  members  of  the  League,  which  hereby  undertake  im- 
mediately to  subject  it  to  the  severance  of  all  trade  or  financial 
relations,  the  prohibition  of  all  intercourse  between  their  na- 
tionals and  the  nationals  of  the  covenant-breaking  state,  and 
the  prevention  of  all  financial,  commercial,  or  personal  inter- 
course between  the  nationals  of  the  covenant-breaking  state  and 
the  nationals  of  any  other  state,  whether  a  member  of  the 
League  or  not.  .  .  . 

"The  High  Contracting  Parties  agree  further  that  they  will 
mutually  support  one  another  in  the  financial   and  economic 


The  League  of  Nations  229 

measures  which  may  be  taken  under  this  article,  in  order  to 
minimize  the  loss  and  inconvenience  resulting  from  the  above 
measures,  and  that  they  will  mutually  support  one  another  in 
resisting  any  special  measures  aimed  at  one  of  their  number  by 
a  covenant-breaking  state  and  that  they  will  afford  passage 
through  their  territory  to  the  forces  of  any  of  the  High  Con- 
tracting Parties  who  are  co-operating  to  protect  the  covenants 
of  the  League." 

ARTICLE  XIX 

"...  Other  peoples,  especially  those  of  Central  Africa,  are  at 
such  a  state  that  the  mandatory  .  .  .  will  also  secure  equal  op- 
portunities for  the  trade  and  commerce  of  the  other  members  of 
the  League." 

ARTICLE  XXI 

"The  High  Contracting  Parties  agree  that  provision  shall  be 
made  through  the  instrumentality  of  the  League  to  secure  and 
maintain  freedom  of  transit  and  equitable  treatment  for  the 
commerce  of  all  states  members  of  the  League,  having  in  mind 
among  other  things,  special  arrangements  with  regard  to  the 
necessities  of  the  region  devastated  during  the  war  of  1914-18." 

This  is  the  extent  of  the  specific  provision  for  the  adjust- 
ment of  economic  difficulties,  which  we  have  seen  to  be 
the  most  prolific  cause  of  wars.  The  Covenant  recognizes 
the  power  of  economic  and  financial  pressure  against  a 
refractory  state.  Articles  XIX  and  XXI  contain  at  least 
a  recognition  of  the  need  for  free  access  to  colonies  for  all 
powers,  and  of  the  importance  of  the  freedom  of  trade 
routes.  But  the  League  fails  to  secure  these  essentials. 
The  problem  of  security  remains  unsolved.  As  it  stands  at 
present,  the  League  is  only  a  beginning,  perhaps  all  that 
could  be  expected  at  the  present  time. 

Even  if  the  League  succeeds  in  solving  the  vexed  prob- 
lems of  raw  materials,  food,  markets,  and  trade  routes, 
there  will  remain  the  difficulty  of  finding  room  for  the 


230  The  Economic  Causes  of  Modern  War 

surplus  populations  of  states  which  are  unwilling  to  see 
their  citizens  domiciled  under  foreign  flags.  For  this  the 
only  solution  is  further  colonial  readjustment,  without 
affecting  international  freedom  of  approach  to  markets  in 
colonies,  but  so  altering  the  boundaries  that  there  may  be 
room  in  the  world  for  all  the  nationalities  to  maintain  their 
coherence. 

Whether  it  endures  or  whether  it  ends  in  failure,  the  pres- 
ent League  is  at  least  an  attempt  at  the  solution  of  the 
problems.  At  least  it  offers  ground  for  hope  that  a  way 
may  yet  be  found  for  relief  of  the  economic  friction  that 
has  caused  so  much  warfare  in  the  past,  through  the  recog- 
nition of  the  need  of  all  the  nations  of  the  world  for 
security  in  their  inevitable  economic  interdependence. 


BIBLIOGRAPHY 


General  Reference  Histories 

Wars  from  1878  to  1918 

Causes  of  War 

League  of  Nations 

General 


BIBLIOGRAPHY 

(Note:  The  volumes  listed  here  include  most  of  the  authorities  con- 
sulted. A  few  statistical  reference  books  have  been  omitted,  and 
contemporary  articles  from  various  journals  have  been  listed  only 
•when  of  especial  importance.  References  to  others  are  invariably 
given  in  foot-notes.) 

GENERAL  REFERENCE  HISTORIES 

Cambridge  Modern  History,  Vol.  XII:  The  Latest  Age,  Cam- 
bridge University  Press,  1917. — An  authoritative  work  but 
with  a  marked  British  bias. 

Hazen,  Charles  Downer:  Europe  Since  1815,  New  York, 
Henry  Holt  &  Co.,  1910. — Useful  but  rather  fragmentary. 

Hazen,  Charles  Downer:  Modern  European  History,  New 
York,  Henry  Holt  &  Co.,  1917. — Elementary  in  its  style 
but  affording  a  good  general  survey  of  the  history  of  the 
period. 
<Holt,  Lucius  Hudson,  and  Chilton,  Alexander  Wheeler: 
History  of  Europe  from  1862  to  1914,  New  York,  Macmil- 
lan,  1917. — A  concise  and  accurate  history.  A  study  of 
political  sequences,  with  excellent  military  studies  by  Cap- 
tain Chilton,  the  junior  author. 

Rose,  J.  Holland:  The  Development  of  the  European  Na- 
tions, 1870-1914,  New  York  and  London,  Putnams,  1916. 
A  general  study  of  European  history  during  approximately 
the  period  covered  by  the  present  volume. 

WARS  FROM  1878  TO  1918 

AFGHAN    WAR 

Adye,  Sir  J.  M.:  Indian  Frontier  Policy,  London,  Smith,  Elder 
&  Co.,  1897. — A  discussion  of  the  Afghan  question  from  the 
point  of  view  of  an  English  colonial  official. 

Causes  of  the  Afghan  War,  Being  a  Selection  of  the  Papers  Laid 
Before  Parliament,  London,  1879.    The  editor  is  not  named. 

233 


234  The  Economic  Causes  of  Modern  War 

Dacosta,  John:  A  Scientific  Frontier,  London  and  Calcutta, 
W.  H.  Allen,  1891. — This  work  is  violently  condemnatory 
of  British  policy. 

Forbes,  Archibald:  The  Afghan  Wars,  1839-1842  and  1878- 
1880,  New  York,  Scribners,  1892. — Contains  a  keenly  crit- 
ical study  of  the  causes  of  the  war  by  a  correspondent  who 
has  probably  seen  more  fighting  than  any  other  European. 

Second  Afghan  War,  Account  by  the  British  Army  Intelligence 
Service,  London,  Murray,  1908. 

ZULU   WAR 

Colenso,  Frances  Ellen:  History  of  the  Zulu  War  and  Its 
Origin,  London,  Chapman  Hall,  1880. — An  account  by  the 
daughter  of  Bishop  Colenso,  the  distinguished  Biblical  critic. 
A  defense  of  the  natives. 

Gibson,  J.  Y.:  The  Story  of  the  Zulus,  New  York,  Longmans, 
1911.     An  impartial  statement  of  facts. 

Johnston,  Sir  Harry:  Britain  Across  the  Seas:  Africa,  Lon- 
don, National  Society's  Depository,  1910. — Imperialistic. 

Norris-Newman,  Charles  L.:  In  Zululand  with  the  British 
Throughout  the  War  of  1879,  London,  W.  H.  Allen,  1880  — 
A  contemporary  account. 

Wilmot,  A.:  History  of  the  Zulu  War,  London,  Richardson  & 
Best,  1880. — British  colonial  point  of  view. 

the  nitrate  war 

Anon.:  Difficulty  Between  Chile  on  the  One  Hand  and  Peru 
and  Bolivia  on  the  Other,  n.d. — A  pamphlet  issued  as 
Chilean  propaganda  in  English. 

Anon.:  Guerre  entre  Le  Chili,  he  Perou,  et  La  Bolivia,  Paris 
Imprimerie  Nouvelle,  1879. — A  contemporary  collection  of 
Chilean  documents  and  comments  favorable  to  Chile  from 
the  European  press. 

Anon.:  "The  Tacna-Arica  Controversy,"  The  Covenant,  a 
Quarterly  Journal  of  the  League  of  Nations:  i:  426-429: 
Apr.,  '20. — A  non-partisan  summary  of  the  origin  and  pres- 
ent status  of  the  dispute. 


Bibliography  235 

Alzamara,  I.:  Peru  and  Chile,  n.d. — A  reprint  from  La  Re- 
forma  Social. — Comment  on  the  renewal  of  the  dispute 
during  1918,  by  a  former  Vice-President  of  Peru. 

Arano,  Diego  Barros:  Histoire  de  la  Guerre  de  la  Pacifique, 
Paris,  Librairie  Militaire  de  J.  Dumaine,  1881. — Primarily 
a  military  study,  but,  like  most  military  histories,  contains 
a  succinct  chapter  on  war  causes. 

Arthur,  Chester  A.:  Message  from  the  President  of  the 
United  States,  Transmitting  Papers  Relating  to  the  War  in 
South  America  and  Attempts  to  Bring  About  a  Peace, 
Washington,  Government  Printing  Office,  1882. — Contains 
numerous  documents  extremely  ill-arranged. 

Boyd,  R.  Nelson:  Chili:  Sketches  of  Chili  and  the  Chilians 
During  the  War,  London,  W.  H.  Allen  &  Co.,  1881. — A  clear 
but  not  very  comprehensive  chapter  on  the  dispute  over  the 
nitrate  lands.  The  date  of  the  declaration  of  war  is  errone- 
ously given. 

Le  Leon,  M.:  Souvenirs  a  L'Armee  Chilienne,  Paris,  Librairie 
Militaire,  L.  Baudoin  et  Cie.,  1883. — A  study  by  a  French 
naval  officer. 

Mantua,  V.  M.,  and  Pezet,  F.  A.:  The  Question  of  the  Pa- 
cific, Philadelphia,  Press  of  Geo.  F.  Lasher,  1901. — A  Peru- 
vian statement,  containing  an  excellent  map. 

Official:  Diplomatic  Debate  of  1918,  Valparaiso,  South  Pa- 
cific Mail,  1918. — Documents  of  the  foreign  offices. 


OCCUPATION    OF    EGYPT 

Arminjon,  Pierre:  La  Situation  Economique  et  Financiere  de 
L'Egypte,  Le  Soudan  Egyptien,  Paris,  E.  Pichon,  1911.  A 
French  statistical  study. 

Bourgeois,  Roger:  La  Crise  Egyptienne,  These,  Paris,  A.  Rous- 
seau, 1913. — A  similar  piece  of  work. 

Cromer,  Evelyn  Baring,  First  Earl  of:  Modern  Egypt,  New 
York,  Macmillan,  1916. — Authoritative  first-hand  account. 
Naturally  imperialist. 

Eid,  Alfred:  La  Fortune  Immobiliere  de  L'Egypte  et  sa  Dette 
Hypothecaire,  Paris,  F.  Alcan,  1907. — A  careful  study. 


236  The  Economic  Causes  of  Modern  War 

Gavillot,  J.  C.  Aristide:     L'Angleterre  Ruine  UEgypte,  Paris, 

J.  Andre  et  Cie.,  1895. — Unnecessarily  Anglophobe. 
Haekal,  Mohamed  Husein:     La  Dette  Publique  Egyptienne, 

These,   Paris,   A.    Rousseau,    1912. — A   condensed   view   of 

Egyptian  finances. 
Milner,  Alfred:     England  in  Egypt,  New  York,  Macmillan, 

1912. — Interesting  expression  of  English  opinion. 
Noailles,  A.  M.  R.  A.,  Vicomte  de:     Les  Anglais  en  Egypte, 

Paris,  1898. — Significant  because  of  source  and  date. 
Worsford,  W.  Basil  :     The  Future  of  Egypt,  Collins'  Clear  Type 
Press,  n.d. — Concise  statement  of  the  British  attitude  today. 

ABYSSINIAN    WARS 

Baldissera,  Antonio:  Rapport  sur  les  Operations  Militaires  de 
la  Campaigne  D'Afrique,  Paris,  H.  Charles-Lavauselle,  1898. 
— First-hand  account  by  an  Italian  official. 

Berkeley,  George  Fitz-H.:  The  Campaign  of  Adowa,  West- 
minster, A.  Constable  &  Co.,  1902 — A  general  study. 

Castonnet  des  Fosses,  Henri:  L'Abyssinie  et  les  Italiens, 
Paris,  P.  Tequi,  1897. — A  brief  summary  of  colonial  policy. 

Pellenc,  Capt.  A.  J.  J.  A.:  Les  Italiens  en  Afrique,  Paris,  L. 
Baudoin,  1897. — A  French  military  study. 

CHINO-JAPANESE  WAR 

Ariga,  Nagao:  La  Guerre  Sino-Japonaise  au  Point  de  Vue  du 
Droit  International,  Paris,  A.  Pedone,  1896. — A  study  by  a 
Japanese  university  professor. 

Bujac,  Emile:  La  Guerre  Sino-Japonaise,  Paris,  Henri-Charles 
Lavauselle,  1904. — French  military  criticisms. 

Burleigh,  Bennett:  The  Empire  of  the  East,  London  Chap- 
man and  Hall,  1905. — A  popular  account  by  a  famous  British 
war  correspondent. 

Sauvage,  Lieutenant:  La  Guerre  Sino-Japonaise,  Paris 
Libraire  Militaire  de  L.  Baudoin,  1897.— Intended  for  mili- 
tary use  but  excellent  on  the  causes  of  the  war. 

"Vladimir"  (pseud.)  :  The  Chino- Japanese  War,  New  York, 
Scribners,  1896. — Valuable  study  of  the  causes;  the  choice  of 
a  Russian  pseudonym  is  prophetic. 


Bibliography  237 


BOXER  REBELLION 

Bland,  J.  P.  0.:  China  Under  the  Empress  Dowager,  Philadel- 
phia, J.  B.  Lippincott,  1910. — General  survey  of  the  events 
preceding  the  war. 

Cheminon,  Jules:  Les  Evenements  Militaires  en  Chine,  Paris, 
P.  R.  Chapelot,  1902. — Survey  of  causes. 

Clement,  Paul  H.:  The  Boxer  Rebellion,  a  Political  and  Dip- 
lomatic Review,  New  York,  Columbia  University,  1915. — 
By  far  the  best  book  on  the  subject.  A  careful  study  and 
analysis  of  the  causes  of  the  war  and  an  evaluation  of  their 
relative  importance. 

Holcombe,  Chester:  The  Real  Chinese  Question,  New  York, 
Dodd,  Mead  &  Co.,  1900. — Investigation  of  Chinese  con- 
ditions. 

Landor,  A.  H.  S.:  China  and  the  Allies,  New  York,  Scribners, 
1901. — Both  sides  of  the  question  presented. 

RUSSO-JAPANESE    WAR 

Asakawa,  Kanichi:  The  Russo-Japanese  Conflict,  Boston, 
Houghton,  Mifflin  &  Co.,  1904. — Acute  analyses  of  the  eco- 
nomic motives  on  both  sides,  with  thorough  documentation 
and  many  statistics. 

"Chausseur"  (Pseud.)  :  A  Study  of  the  Russo-Japanese  War, 
London,  William  Blackwood  &  Sons,  1915. — Survey  of  rela- 
tions between  the  two  powers. 

China  Yearbook,  1919-20,  London,  George  Routledge  &  Son, 
New  York,  E.  P.  Dutton. — A  useful  reference  book. 

Cowen,  Thomas:  The  Russo-Japanese  War,  London,  Edward 
Arnold,  1904. — Contains  frequent  expression  of  Marquis 
Ito's  opinions  not  otherwise  obtainable. 

Japan  Yearbook  (Y.  Takenob,  ed.),  Japan  Yearbook  Office, 
Tokyo,  1918. 

Japan  Yearbook,  1913-1914,  Japan  Gazette  Co.,  Yokohama,  1914. 
— Both  these  contain  much  useful  information. 

Kinai,  M.:  The  Russo-Japanese  War  (Official  Reports),  Tokyo, 
The  Shimbashido,  n.  d. — An  excellent  Japanese  account. 


238  The  Economic  Causes  of  Modern  War 

Kuropatkin,  General  Alexei  Nikolayevttch  :  The  Russian 
Army  and  the  Japanese  War,  Captain  A.  B.  Lindsay,  trans., 
New  York,  E.  P.  Dutton,  1909. 

McCormick,  Frederick:  The  Tragedy  of  Russia  in  Pacific 
Asia,  London,  Grant  Richards,  1909.  Of  value  only  as  a 
study  of  Russian  policy. 

McLaren,  W.  W.:  A  Political  History  of  Japan  During  the 
Meiji  Era,  1867-1912,  London,  George  Allen  &  Unwin,  Ltd., 
New  York,  Scribners,  1916.  First-hand  information  by  an 
American  economist  familiar  with  the  people  and  the 
country. 

Millerand,  Thomas:  Democracy  and  the  Eastern  Question, 
New  York,  The  Century  Company,  1919. — Examination  of 
the  Eastern  question  with  special  reference  to  the  United 
States. 

Pinon,  Rene:  La  Lutte  pour  le  Pacifique,  Paris,  Perrin  et  Cie., 
1916. — A  study  of  the  origins  and  results  of  the  war  apart 
from  its  incidents.  Some  attention  to  American  problems 
in  the  Philippines. 

Porter,  R.  P.:  Japan,  the  Rise  of  a  Modern  Power,  Oxford, 
The  Clarendon  Press,  1918. — Economic  analysis. 

Ross,  Colonel  Charles:  An  Outline  of  the  Russo-Japanese 
War,  London,  Macmillan,  1912. — Not  very  acute  account 
of  causes  but  a  good  working  outline,  as  its  name  implies. 

Sherrill,  Charles  H.:  Have  We  a  Far-Eastern  Policy?  New 
York,  Scribners,  1920.    The  author  is  an  American  diplomat. 

German  General  Staff:  Official  Account  of  the  Russo-Japa- 
nese War,  Lieutenant  Karl  von  Donat,  translator. — A  vo- 
luminous work,  but  with  an  excellent  account  of  the  causes  in 
fairly  brief  compass. 

CUBAN    INSURRECTION   AND    SPANISH-AMERICAN    WAR 

Bujac,  Emile:  La  Guerre  Hispano-Americaine,  Paris,  H. 
Charles-Lavauselle,  1899. — A  European  view  of  the  conflict. 

Callahan,  James  M.:  Cuba  and  Its  International  Relations, 
Baltimore,  Johns  Hopkins  University  Press,  1899. — Inter- 
esting as  a  contemporary  account. 


Bibliography  239 

Chadwick,  French  E.:  Relations  of  the  United  States  and 
Spain,  New  York,  Scribners,  1911. — Deals  mainly  with 
diplomacy. 

Draper,  Andrew  Sloan:  Rescue  of  Cuba,  New  York,  Silver 
Burdett  and  Co.,  1910. — A  little  economic  information. 

Gossip,  G.  H.  D.:  "The  Mournful  Case  of  Cuba,"  Fortnightly 
Review:   69:  832-843:  May,  '98.    Much  valuable  data. 

Latane,  J.  H.:  America  as  a  World  Power,  New  York,  Harpers, 
1907. — A  general  consideration  of  America's  new  role  with 
some  attention  to  Cuba. 

Latane,  J.  H.:  Diplomacy  of  the  United  States  with  Regard  to 
Cuba,  American  Historical  Association,  Annual  Report,  1897, 
pp.  217-277. — Mainly  diplomatic. 

Lodge,  Henry  Cabot:  The  War  with  Spain,  New  York, 
Harpers,  1899. — Interesting  because  of  the  author's  position. 

Matheson,  Fred  J.:  "The  United  States  and  Cuban  Inde- 
pendence," Fortnightly  Review:  69:  816-832:  May,  '98. 

Morrison,  Charles:  The  War  with  Spain,  Philadelphia,  J. 
B.  Lippincotts,  1899. — Contemporary  but  rather  popular. 

Robinson,  Albert  G.:  Cuba  and  the  Intervention,  New  York, 
Longmans,  1905. — Covers  the  whole  period  of  the  disturb- 
ance and  investigates  the  economic  causes  completely. 

Taylor,  Hannis:  "A  Review  of  the  Cuban  Question  in  its 
Economic,  Political,  and  Diplomatic  Aspects,"  North  Ameri- 
can Review:  165:610-612,  N.,  '97. 

GRECO-TURKISH    WAR 

Bartlett,  Sir  Ellis  Ashmead:     The  Battlefields  of  Thessaly, 

London,    John    Murray,    1897. — The    author    has    evident 

Turkish  sympathies. 
Bikelios,  Demetrios:  he  Role  et  les  Aspirations  de  la  Grece 

dans  la  Question  d'Orient,  Paris,  Au  Cercle  Saint-Simon, 

1885. — The  Greek  account. 
Bickford-Smith,  R.  A.  H.:    Greece  Under  King  George,  London, 

R.  Bentley  &  Son,  1893. — Incidental  references  to  incidents 

preceding  the  war. 
Ministere  des  Affaires  Etrangeres:     Documents  Diplomatiques, 

1897. — Like  most  diplomatic   interchanges,   fails   to   make 

clear  the  concealed  economic  motive. 


240  The  Economic  Causes  of  Modern  War 

OlKONOMOPOULOS,   ElIAI      'lo-TOpLCL  TOV  'EX\r]VOTOVpKOV  TToXe/JLOV 

Athens,  1918. — A  lengthy  Greek  account  of  the  war. 


THE  BOER   WARS 

Cana,  Frank  R.:  South  Africa  from  the  Great  Trek  to  the 
Union,  London,  Chapman  and  Hall,  1909. — An  English 
version  characterized  by  great  fairness  to  the  Boers. 

Cappen,  James:  Britain's  Title  to  South  Africa,  London,  Mac- 
millan,  1901. — British  imperialistic  bias. 

Cecil,  Evelyn,  M.  P.:  On  the  Eve  of  the  War,  London,  John 
Murray,  1900. — An  English  politician's  ideas. 

Cook,  Edward  T.:  The  Rights  and  Wrongs  of  the  Transvaal 
War,  London,  Edwin  Arnold,  1902. — Fair  effort  at  giving 
both  sides. 

Doyle,  Sir  Arthur  Conan:  The  Great  Boer  War,  New  York, 
McClure,  Phillips,  and  Co.,   1912. — Ardently  imperialistic. 

Eybers,  G.  W.:  Select  Constitutional  Documents  Illustrating 
South  African  History,  London,  George  Routledge  &  Sons, 
Ltd.,  New  York,  E.  P.  Dutton,  1918. — A  good  source  book. 

Fisher,  W.  E.  Garrett:  The  Transvaal  and  the  Boers,  London, 
Chapman  and  Hall,  1900. — General  history. 

Hobson,  J.  A.:  The  War  in  South  Africa,  Its  Causes  and  Its 
Effects,  New  York,  Macmillan,  1900. — An  economic  inter- 
pretation by  a  distinguished  British  economist,  who  accuses 
international  financiers  of  deliberately  precipitating  the  war. 

Wilmot,  Hon.  A.:  Manual  of  South  African  History,  London, 
Kegan  Paul,  Trench,  Triibner  &  Co.,  1901. — Especially  use- 
ful for  the  earlier  parts  of  the  history  of  the  Boers. 

Mitchell,  L.:  Life  and  Times  of  the  Right  Honorable  Cecil 
John  Rhodes,  New  York,  Kennerley,  1910. — A  study  of 
Rhodes'  life  is  indispensable  to  understanding  South  African 
history. 

herero  rising 

Calvert,  Albert  Frederick:  Southwest  Africa  During  the 
German  Occupation,  1884-1914,  London,  T.  W.  Laurie,  1915. 
— Contains  a  brief  statement  of  the  facts. 


Bibliography  241 

Leutwein,  Theodor:  Die  Kampfe  mit  Hendrik  Witboi,  Leip- 
zig, R.  Voigtlander,  1912. — Colonel  Leutwein's  account  of 
the  first  Hottentot  rising,  which  preceded  the  Herero  Rising. 

Sander,  L.:  Geschichte  der  Deutsches  Kolonial-Gesellschaft 
fur  Sudwest-Afrika,  Berlin,  Dietrich  Reimer,  1912. 

Articles  under  "German  Southwest  Africa"  in  the  New  Interna- 
tional Encyclopedia  and  the  Encyclopedia  Britannica. 


ITALO-TURKISH    WAR 

Barclay,  Sir  Thomas:  The  Turco-Italian  War,  London,  Con- 
stable, 1912.  Both  causes  of  the  war  and  the  operations  are 
discussed. 

Bratjn,  Ethel:  What  I  Saw  in  Tripoli,  London,  T.  F.  Unwin, 
1914. — Study  of  the  country,  people,  and  resources. 

Foerster,  Robert  F.:  Italian  Emigration  of  Our  Times,  Cam- 
bridge, Harvard  University  Press,  1919. — An  exhaustive 
investigation  of  the  Italian  population  question. 

Lapworth,  Charles:  Tripoli  and  Young  Italy,  London,  S. 
Swift  &  Co.,  1912. — Examination  of  the  relationship  between 
Tripoli  and  Italy,  the  Italian  need  for  the  country,  causes 
of  the  war,  resources,  etc. 

Mehier  de  Mathiuisieulx,  Henri:  La  Tripolitaine  d'Hier  et 
de  Demain,  Paris,  Hachette  et  Cie.,  1912. — A  French  view 
which  is  important  because  of  the  Franco-Italian  colonial 
relations. 

THE   BALKAN    WARS 

Baucabeille,  B.  P.  L.:     La  Guerre   Turco-Balkanique,  Paris, 

Chapelot,  1914. — A  fairly  complete  account. 
Becker,  G.:     La  Guerre  C ontemporaine  dans  les  Balkans  et  la 

Question   d'Orient,   Paris,   Berger   Levrault,    1899.     Much 

valuable  data  on  the  causes  of  the  wars. 
Campbell,  Cyril:     The  Balkan  War  Drama,  New  York,  Mc- 

Bride  &   Co.,    1913.     Attention  given  to   incidents  rather 

than  causes  of  the  war. 
Carnegie  Endowment  for  Peace:     Enquete  dans  les  Balkans, 

Rapport,  Paris,  G.  Cres  et  Cie.,  1914. — A  study  of  causes. 


242  The  Economic  Causes  of  Modern  War 

Devas,  Georges:     La  Nouvelle  Serbie,  Paris,  Berger-Levrault, 

1918.    Special  study  of  Serbian  difficulties  and  progress. 
Fellion,  Georges:     Entre  Slaves,  Paris,  Societe  des  Ecrivains, 

Frangais,  1894. — Useful  for  the  Serbo-Bulgarian  War. 
Forbes,  Nevill:     The  Balkans  (with  A.  Toynbee,  D.  Mitrany, 

D.  G.  Gogart),  Oxford,  Clarendon  Press,  1915. — Dr.  Forbes 

is  a  distinguished  Slavic  scholar,  better  able  to  understand 

the  Balkans  than  those  who  do  not  speak  their  languages. 
Fox,  Frank:     The  Balkan  Peril,  London,  Black,   1915. — The 

European  significance  of  the  Balkan  troubles. 
Leffan,  R.  D.  G.:     The  Serbs,  Guardians  of  the  Gate,  Oxford, 

Clarendon  Press,  1918. — A  good  handbook  for  Serbian  his- 
tory. 
Loiseau,   Charles:     he  Balkan  Slav   et  la  Crise  Autrichien, 

Paris,  Perrin  et  Cie.,  1898. — A  French  criticism  of  Austrian 

policy. 
Miller,  William:     The  Balkans,  New  York,  Putnams,  1911. — 

Description  of  the  condition  of  the  Balkan  states  before  the 

outbreak  of  the  wars  of  1912-1913. 
Mozet,  Alfred:     Le  Monde  Balkanique,  Paris,  E.  Flammarion, 

1917.     A  good  deal  of  discussion  of  the  wars  and  their 

genesis. 
Rankin,  Colonel  Reginald:     Inner  History  of  the  Balkan  War, 

London,  Constable  &  Co.,  1914. — Investigation  of  the  causes 

of  the  wars. 
Regenspurgsky,  Colonel  Karl:     La  Guerre  Serbo-Bulgare  de 

1885,  Lieutenant  Barth,  Translator,  Paris,  Berger-Levrault, 

1897. — Expression  of  an  Austrian  army  officer's  views. 
von  Huhn,  Major  Arthur  Ernst:     The  Struggle  of  the  Bulgars 

for  Natural  Independence  under  Prince  Alexander,  London, 

John  Murray,  1886. 


the  world  war 

Ajam,  Maurice:  Le  Probleme  Bconomique  Franco- Allemande, 
Paris,  Perrin  et  Cie.,  1914. — Author's  official  position  and 
intimate  knowledge  makes  the  book  of  value. 

Bang,  J.  P.:  Hurrah  and  Hallelujah,  Jessie  Biicher,  translator, 
New  York,  George  H.  Doran  Co.,  1917. — A  compilation  of 


Bibliography  243 

German  war  utterances,  giving  an  accurate  view  of  one  side, 
at  least,  of  the  national  mind. 

Compilation  :  Modern  Germany  in  Relation  to  the  Great  War, 
New  York,  Kennerley,  1916. — Most  of  the  contributors  are 
university  professors. 

Compilation  :  Out  of  Their  Own  Mouths,  New  York  and  Lon- 
don, D.  Appleton  &  Co.,  1917. — German  war  utterances, 
some  of  which  throw  light  on  the  attitude  toward  England. 

Cheradame,  Andre:  he  Plan  Pangermaniste  Demasque,  Paris, 
Plon-Nourrit  et  Cie.,  1916. — Well-known  French  expose  of 
extreme  Pan-German  ambitions. 

Cheradame,  Andre:  La  Question  d 'Orient,  Paris,  Plon-Nourrit, 
et  Cie.,  1915. — The  attitude  of  all  the  Powers  toward  the 
Bagdad  Railway. 

Davis,  William  Stearns:  The  Roots  of  the  War,  New  York, 
Century  Company,  1918. — Concise  and  accurate  volume  by 
an  American  scholar. 

Eckel,  Edwin  C:  Coal,  Iron,  and  War,  New  York,  Holt,  1920. 
— The  most  recent  book  on  this  important  subject. 

Frank,  Glenn,  and  Stoddard,  Lothrop:  The  Stakes  of  the 
War,  New  York,  Century  Company,  1918. — A  compilation 
of  economic,  historic,  and  political  data,  extremely  well 
arranged. 

Gay,  E.  F.:  "French  Iron  and  the  War,"  Military  Historian  and 
Economist:  1:306-309:  July,  16.  A  brief  but  illuminating 
summary  based  largely  on  German  sources  and  the  report  of 
the  Stockholm  Geological  Congress  of  1910. 

Guyot,  Yves:  The  Causes  and  Consequences  of  the  War,  F. 
Appleby  Holt,  translator,  London,  Hutchinson  &  Co.,  1916. 
— Much  attention  to  economics. 

Jastrow,  Morris:  The  War  and  the  Bagdad  Railway,  Phila- 
delphia, J.  P.  Lippincott,  1918. — Historical  and  geographical. 

Jeans,  W.  T.:  The  Creators  of  the  Age  of  Steel,  New  York, 
Scribners,  1884. — A  chapter  devoted  to  Sidney  Gilchrist 
Thomas. 

Natjmann,  Friedrich:  Central  Europe,  Christabel  Meredith, 
translator,  New  York,  Knopf,  1917. — A  prominent  Ger- 
man, member  of  the  Reichstag,  gives  his  opinions  as  to 
Germany's  situation. 


244  The  Economic  Causes  of  Modern  War 

Nystrom,  Anton:  Before,  During,  and  After  1914,  H.  G. 
de  Walterstorff,  translator,  London,  William  Heinemann, 
1915. — A  chapter  on  overpopulation  and  its  dangers. 

Pinon,  Rene:  France  et  Allemagne,  1870-1913,  Paris,  Perrin 
et  Cie.,  1906. — A  useful  documentation  of  the  Moroccan 
crisis. 

Schmitt,  Bernadotte  Everly:  England  and  Germany,  1740- 
1914,  Princeton,  University  Press,  London,  Humphrey  Mil- 
ford,  1916.    Valuable  but  rather  pro-English. 

Seeley,  J.  R.:  The  Expansion  of  England,  London,  Macmillan, 
1914.    Explanation  of  British  colonization. 

Seligman,  E.  R.  A.:  An  Economic  Interpretation  of  the  War, 
New  York,  D.  Appleton  &  Co.,  1915. — Much  valuable  in- 
vestigation of  the  economic  causes  of  the  World  War. 

von  Bernhardi,  General  Friedrich:  Germany  and  England, 
New  York,  G.  W.  Dillingham,  1915. — Explanatory  volume 
to  Germany  and  the  Next  War.  Indicates  German  fear  of 
British  trade. 

CAUSES  OF  WAR 

Anon.:     Historical  Illustration  of  the  Origin  and  Consequences 

of  War,  London  Peace  Society  Tracts,  No.  10,  1838.    Out 

of  date  but  not  without  value. 
Crosby,  Oscar  T. :     International  War,  Its  Causes  and  Its  Cure, 

London,  Macmillan,   1919. — The  most  exhaustive  book  on 

the  subject.    The  author  is  a  former  army  officer. 
Hall,  H.  Fielding:     Nature  of  War  and  Its  Causes,  London, 

Hunt  and  Blackett,  1917. — A  good  general  survey  of  the 

field. 
Howerth,  I.  W.:     "The  Causes  of  War,"  Scientific  Monthly: 

2:118-124,  F.,  '16.   An  interesting  review  of  this  phase  of  the 

subject. 
Oliver,  F.  S.:     Ordeal  by  Battle,  London,  Macmillan,  1915. — 

Conventional  "war  book"  but  with  a  fair  discussion  of  the 

general  causes  of  wars. 


Bibliography  245 

LEAGUE   OF    NATIONS 

Berry,  Lieutenant  Trevor  T.:  The  Hope  of  the  World,  Lon- 
don, P.  S.  King  &  Son,  1919. — An  accurate  estimate  of  the 
significance  of  raw  materials. 

Butler,  Sir  Geoffrey:  A  Handbook  to  the  League  of  Nations, 
London,  Longmans  Green,  1919. — Conventional  historico- 
legal  discussion.  Good  outline  of  the  machinery  of  the 
League  and  a  convenient  grouping  of  documents. 

Brailsford,  Henry  Noel:  A  League  of  Nations,  New  York, 
Macmillan,  1917. — Examination  of  the  economic  conditions 
which  make  a  league  necessary. 

Covenant,  The,  A  Quarterly  Journal  of  the  League  of  Nations, 
Nos.  1,  2,  and  3.  Discussion  of  problems  affecting  the 
League  as  they  arise.  Many  maps  and  a  full  appreciation 
of  economic  conditions  affecting  the  relations  of  states. 

Crozier,  Alfred  Owen:  League  of  Nations:  Shall  It  Be  an 
Alliance  or  a  Nation  of  Nations?  New  York,  Le  Couver 
Press  Co.,  1919. — Advocates  "territorial  surgery"  and  inter- 
nationalization of  important  waterways. 

Crozier,  Alfred  Owen:  Nation  of  Nations — A  Way  to  Peace. 
Cincinnati,  Stewart  Kidd  &  Co.,  1915. — Assertion  of  the 
practical  value  of  the  League. 

Dwight,  W.  Morrow:  The  Society  of  Free  States,  New  York, 
Harper,  1919.  Like  Mr.  Garvin,  the  author  reads  a  moral 
from  the  economic  co-operation  of  the  Allies  in  war-time. 

Erzberger,  Matthias:  The  League  of  Nations,  New  York,  Holt, 
1919. — A  clear  expression  of  the  German  attitude.  Especial- 
ly to  be  examined  because  of  its  economic  complaints. 

Garvin,  J.  L.:  The  Economic  Foundations  of  Peace,  London, 
Macmillan,  1919. — Insists  on  economic  justice  as  the  only 
ground  of  permanent  peace.  Rather  incoherently  written 
as  a  whole,  but  of  the  greatest  value. 

Hamilton,  General  Sir  Ian:  The  Millennium,  London,  Ed- 
ward Arnold,  1919. — "I  have  arrived  at  a  grand  junction 
where  on  the  one  hand  I  see  reflected  into  the  sky  Old 
Glory  floating  side  by  side  with  our  own  Imperial  Standard; 
and  on  the  other,  darkness — darkness." 

Hobson,  J.  A.:  Towards  International  Government,  New  York, 
Macmillan,  1915. — An  economist's  view. 


246  The  Economic  Causes  of  Modern  War 

La  Fontaine,  Henri:  The  Great  Solution,  Magnissima  Charta, 
Boston,  World  Peace  Foundation,  1916. — A  political  rather 
than  economic  study  of  the  League. 

Lawrence,  T.  J.:  The  Society  of  Nations,  Its  Past,  Present,  and 
Possible  Future,  New  York,  Oxford  University  Press,  1919. 
— Historical  and  legal. 

Milhaud,  Edgard:  La  Societe  des  Nations,  Paris,  Bernard 
Grasset,  1917. — One  chapter  on  the  economic  sanction. 

Minor,  Raleigh  C:  A  Republic  of  Nations,  New  York,  Oxford 
University  Press,  1918. — A  review  of  current  opinion. 

Official  Journal,  Nos.  1,  2,  and  3. — Documents  of  the  League  of 
Nations. 

Paish,  George:  A  Permanent  League  of  Nations,  London,  T. 
Fisher  Unwin,  1918. — Discussion  of  the  importance  of 
economic  interdependence  and  international  trade  as  affect- 
ing war  and  peace. 

Sayre,  Francis  Bowes:  Experiments  in  International  Admin- 
istration, New  York,  Harpers,  1919. — Chiefly  historical. 

Smuts,  Lieutenant  General  the  Rt.  Hon.  Jan  C.:  The 
League  of  Nations,  a  Practical  Suggestion,  New  York,  Nation 
Press,  1919. — A  careful  and  able  discussion  of  economic  and 
financial  aspects  is  included. 

Stall ybrass,  W.  T.  S.:  A  Society  of  States,  New  York,  E.  P. 
Dutton,  1919. — Economic  conditions  wholly  neglected. 

Wells,  H.  G.:  Idea  of  a  League  of  Nations,  Boston,  Atlantic 
Monthly  Press,  1919. — A  group  of  eminent  collaborators 
have  assisted  the  author;  they  deduce  the  necessity  of  the 
League  from  the  nature  of  our  civilization. 

Woolf,  Leonard  S.  (editor)  :  Framework  of  a  Lasting  Peace, 
London,  Allen  and  Unwin,  1917. — Contains  the  Hague 
Minimum  Programme,  the  Fabian  Society's  Draft  Treaty, 
and  other  proposals. 

GENERAL 

Alfassa,  Maurice:    L'Apres  Guerre,  Paris,  Belin  Freres,  1918. — 

Economic  effects  of  the  war. 
Angell,    Norman     (Pseud.)  :      Foundations    of    International 

Polity,  London,  William  Heinemann,  1914. — War  held  to  be 

unprofitable. 


Bibliography  247 

Angell,  Norman  (Pseud.)  :  The  Great  Illusion,  New  York, 
Putnams,  1910. — Development  of  the  author's  well-known 
pacifism  and  theory  of  the  economic  prevention  of  war. 

Barker,  J.  Ellis:  Economic  Statesmanship,  London,  John  Mur- 
ray, 1918. — Study  mainly  of  after-war  problems. 

Brown,  Philip  M.:  International  Realities,  New  York,  Scrib- 
ners,  1917. — Advocates  a  gentler  sort  of  Realpolitik. 

Bourne,  Randolph  S.:  Towards  an  Enduring  Peace,  American 
Association  for  International  Conciliation,  1916. — A  valuable 
symposium. 

Brailsford,  Henry  Noel:  The  War  of  Steel  and  Gold,  A  Study 
of  the  Armed  Peace,  New  York,  Macmillan,  1915. — Dis- 
passionate investigation  of  the  effects  of  economics  and 
finance  on  international  relations. 

Chester,  Rear- Admiral  Colby  C:  "Present  Status  of  the 
Monroe  Doctrine,"  Annals  of  the  American  Academy  of 
Political  and  Social  Science,  July,  1914. 

Clark,  J.  Maurice,  Hamilton,  Walter  H.,  and  Moulton, 
Harold  G.:  Readings  in  the  Economics  of  War,  Chicago, 
University  of  Chicago  Press,  1918. — A  collection  of  most 
suggestive  material,  mainly  journalistic. 

Dawson,  W.  H.:  Evolution  of  Modern  Germany,  New  York, 
Scribners,  1914. — An  excellent  study  of  German  develop- 
ment. 

Dickinson,  G.  Lowes:  The  Choice  Before  Us,  New  York, 
Dodd,  Mead  &  Co.,  1917. — Causation  of  wars  and  preven- 
tion of  future  wars. 

Dillon,  E.  J.:  The  Inside  Story  of  the  Peace  Conference,  New 
York,  Harpers,  1920. — Vivid  picture  of  the  Conference,  with 
discussion  of  economic  interests  among  others,  by  an  eminent 
authority. 

Drage,  Geoffrey:  Austria- Hungary,  London,  John  Murray, 
1909. — Much  information  on  economic  relations. 

Faries,  John  Cuthbert:  The  Rise  of  Internationalism,  New 
York,  W.  D.  Gray,  1915. — The  Appendix  contains  a  collec- 
tion of  material  not  accessible  elsewhere. 

Fullerton,  William  M.:  Problems  of  Power,  New  York, 
Scribners,    1913. — Published    immediately   before   the   war. 


248  The  Economic  Causes  of  Modern  War 

Contains  a  full  discussion  of  the  world  situation,  as  it  existed 
then. 

Gibbons,  Herbert  Adams:  The  New  Map  of  Europe,  Century- 
Company,  1914. 

Gibbons,  Herbert  Adams:  The  New  Map  of  Africa,  Century 
Company,  1916. 

Gibbons,  Herbert  Adams:  The  New  Map  of  Asia,  Century 
Company,  1920. — A  series  of  anti-imperialistic  researches 
into  the  imperialism  of  all  nations. 

Haskins,  Charles  Homer,  and  Lord,  Robert  Howard:  Some 
Problems  of  the  Peace  Conference,  Harvard  University  Press, 
1920.     First-hand  information  by  two  eminent  authorities. 

Hassall,  Arthur:  History  of  British  Foreign  Policy  from  the 
Earliest  Times  to  1912,  Edinburgh  and  London,  W.  Black- 
wood &  Son,  1912. — Covers  the  field  thoroughly. 

Hirst,  F.  W.:  The  Political  Economy  of  War,  London,  J.  M. 
Dent,  1916. — The  only  existing  text-book.  It  neglects, 
however,  the  economic  causes. 

Hutton,  J.  Arthur:  The  Cotton  Crisis,  Manchester,  British 
Cotton-Growing  Association,  1904. — Exposition  of  the 
British  difficulties  with  regard  to  cotton. 

Keynes,  John  Maynard:  The  Economic  Consequences  of  the 
Peace,  New  York,  Harcourt,  Brace  &  Howe,  1920. — Insist- 
ence upon  economic  justice  as  a  basis  of  peace. 

Latane,  J.  H.:  From  Isolation  to  Leadership,  Garden  City, 
Doubleday  Page  &  Co.,  1918. — Study  of  the  evolution  of 
the  international  status  of  America. 

Lawson,  W.  R.:  Modern  War  and  War  Taxes,  Edinburgh  and 
London,  W.  Blackwood  &  Sons,  1912. — Refutation  of  Mr. 
Norman  Angell's  theories. 

Lambrino,  Georges:  Finance  de  Guerre,  Paris,  Sirey,  1913. — 
The  relationship  between  finance  and  war. 

Lippman,  Walter:  The  Stakes  of  Diplomacy,  New  York,  Holt, 
1915. — An  admirable  statement  of  the  need  of  economic 
expansion  and  its  relation  to  war. 

Muir,  Ramsay:  The  Expansion  of  Europe,  Boston,  Houghton 
Mifflin  &  Co.,  1917. — Traces  the  motives  and  effects  of  im- 
perialism. 


Bibliography  249 

Robinson,  E.  V.  D.:  "War  and  Economics,"  Political  Science 
Quarterly:  15:581-629:  D.,  '00.  Deals  mainly  with  ancient 
wars.    Highly  suggestive.    Good  bibliography. 

Seligman,  E.  R.  A.:  The  Economic  Interpretation  of  History, 
New  York,  Columbia  University  Press,  1903.  Carries  fur- 
ther the  notions  of  Karl  Marx. 

Veblen,  Thorstein  B.:  An  Inquiry  into  the  Nature  of  Peace 
and  the  Terms  of  Its  Perpetuation,  London  and  New  York, 
Macmillan,  1917. — Theories  of  a  well-known  American 
writer. 


INDEX 


INDEX 


d'Abruzzi,  Due,  131 

Abyssinian  Wars,  46,  48,  49,  78-80 

Access  to  sea,  172,   173 

Achard,  Franz  Carl,  117 

Aden,  34 

Adowah,  Battle  of,  80 

Adrianople,   138 

Adriatic,   137 

Aerial  warfare,  220 

Afghanistan 

frontier,  99 

invasions,  35,  46,  48,  50-56 
Africa 

Central,  191,  229 

development  of,  210 

France  in,  204,  185 

freedom  of  access,  226 

Germany  in,  204 

opening  of,  43,  44,  79 

slave  trade,  198 

South,  185 

Stanley,  Henry  M.,  in,  43,  44 
African  Review,  113 
Afrikanders,  see  Boers 
Agadir    incident,    12,    142,    149,    156, 

157,  191,  192,  193 
Agordat,  Battle  of,  79 
Agriculture,  11,  199 
Agronomy,  199 
Ajam,  Maurice,  quoted,  19-n 
Albania,  133,  137,  170 
Alcohol,    international    congress   on, 

199 
Aleppo,  162 

Alexander  the  Great,   165 
Alexander,    Prince    of    Bulgaria,    77 
Alexandria,  massacre  at,  72 
Algeciras  Conference,  157 
Algiers,  155 
Ali,  Mohammed,  65 
Ali,  Shere,  53 
Allenby,  General,  3 
Alliance,  see  Triple  Alliance 
Allies,  economic  union  of,  222 
Alsace-Lorraine,  9,  44,  150,  204 
America,  see  United  States 
America,  South,  British  investments 
in,  184 


American  cotton,  23,  212-214 
Amsterdam,  port  of,  158 
Amir  of  Afghanistan,  51,  53,  54 
Amur,  92,  99 
Ancestor-worship,  93,  95 
Ancon,  Treaty  of,  58,  63,  64 
Andes  boundary  question,  62 
Angell,  Norman,  quoted,  177 
Anglo-French  Entente,  75 
Anglo-German    trade    rivalry,    142, 

144-150,  166,  210 
Anglo-Japanese  Alliance,  100 
Anglo-Russian    Agreement,    35,    39, 

56,  139 
Angora,  161,  169 
Annam,    French   in,  46,  48,   49,   81, 

82,  139 
Antafagasta,  61,  64 
Anti-imperialist     tradition,     Ameri- 
can, 27 
Antimony,  154 
Antwerp,  port  of,  158 
Armenia 

religion  in,  4 

riots  in,  46 
Arabian  Ocean,  33 
Arabi  Pasha,  71,  72 
Archangel,  port  of,  39,  97 
Argentina 

Chilean   relations  with,  62 

French  investments  in,  185 

revolts  in,  46 
Arica,  59,  64 
Armada,  Spanish,  190 
Army,  Afghan,  52 
Art,    international    conference    on, 

199 
Asakawa,  K.,  quoted,  26 
Ashantee  War,  46 
Asia 

British  investments  in,  184 

Central,  160 
Asia  Minor 

economic   penetration,    164 

economic  unity,  163 

railways,  216 

Russian  railway  rights,  162 

strategic  value,  164,  165 

Turkish  military  reservoir,   169 
Assan,  Japanese  victory  at,  86 


253 


254 


Index 


Assouan  dam,  67 

Assyria,  6,  165 

Atacama,  Desert  of,  57,  59,  60,  61 

Attache,  commercial,  208 

Australia,    British    investments    in, 

184 
Austria-Hungary 

Bagdad  Railway,  170 

Balkan  policy,  *134,  135,  137,  172 

Berlin,  Treaty  of,  41 

Bulgarian  trade,  174 

Capitulations,  68  and  n. 

economic  ambitions,  143,  144,  170- 
175 

economic    situation,    internal,    171 

Egyptian  Debt,  68 

financial     relations     with      Great 
Britain,  188 

French   investments  in,   184 

Hapsburg  dynasty,  3 

markets,  78,  135,  138,  172 

Mittel-Europa,  158 

Rumanian  trade,  174 

Serbo-Bulgarian  War,  78 

Turkish  trade,  174 

Wars  of  1864  and  1866,  8 

War  with  Serbia,  186 
Austrian  Succession,  War  of  the,  2 
Automobiles,  French  export  of,  24 

B 

Babylonia,  6,    165 

Bacteria   in   war,   221 

Bagdad  Railway,  135,  158,  160,  161- 

170,  174,  218,  219 
Bahrein  Islands,  35 
Baku,  oil  wells  at,  56 
Balance  of  Power,  29,  198,  222 
Balkans,  the 

Austrian  ambitions  in,  172 

French  loans  in,  139 

friction  in,  219 

German  aggressions  in,  211 

Italian  ambitions  in,  175 

Russian  influence  in,  41 
Balkan    Wars    (1912-1913),    46,    48, 

132-139,  142,  174 
Ballin,  Albert,  147 
Baltic  Sea,  160 
Baluchistan,  35 
Banca  di  Roma,  131 
Bankers  in  war,  177,  178 
Bank  of  Russia,  180 
Bank    of   Tokio,   180 
Barley,  21,  26 
Barnato,  113 

Bartlett,  Sir  E.   A.,  quoted,  126 
Bases,  see  Naval  bases 


Baskets,   Bavarian,    149 

Bassona,  166 

Bassorah,  162 

Battleships,  damages  to,  33 

Bavarian  industries,  149 

Beaconsfield,  Lord,  see  Disraeli 

Beaconsfield-Salisbury  Cabinet,  53 

Beans,  26,  224 

Beets,  see  Sugar 

Beilul,  occupation  of,  79 

Beirut-Damascus  line,  168 

Belgium 

Balkan   trade,    173 

Capitulations,  68 

defense    of   neutrality,  6 

French  investments  in,  185 

invasion  of,  141,  142 

iron  imports,  151 

population  density,  18-n. 
Belgrade,  1 
Bergasi,  131 
Berlin  Bourse,  186 
Berlin,   Congress  of,  32,  38,  39,  41, 

43,  54,  77,  198 
Berlin,  Treaty  of,  42,  45,  142 
von     Bernhardi,     General,     quoted, 

144-n. 
Bengal,  Gulf  of.  33,  35 
Bessemer,  Sir  Henry,  44 
Bessemer  process,  152 
Bhutan,  35,  36 

Bismarck,  2,  8,  8-n.,  41,  42,  129 
Black  Sea,  39 
Blockade,  22 
Boer  War,  46,  48,  49.  106-116,  139, 

149,  179 
Bolivia,  49,  57,  59,  60,  61,  62,  63 
Bombay,  165 
Bondelzwart  natives,  126 
Bosnia-Herzegovina,  41,  142 
Bosphorus,  40,  41 
Boxer  Rebellion,  46,  48,  90-96,  100, 

139,  210 
Boycott 

Chinese.  193 

Franco-German,  156,  157 
Brazil,   French    investments   in,   185 
Bremen,  port  of,  147 
Breslau,  117 

Brewing    companies,   American,   209 
Briey.  iron  district,  151—152 
British    Empire,   see    Great    Britain 
Bulawayo  Chronicle,  113 
Bulgaria 

Balkan  Wars,  133,  134,  136,  139 

Battle  of  Slivnitza.  173 

debt  to  France,  193 

establishment  of,  40 

freedom,  7 


Index 


255 


Bulgaria  (continued) 

religion  in,  4 

revolution  in,  46 
Burgulu,  162 
Byzantium,  see   Constantinople 


Caisse  de  la  Dette,  68 
Campbell-Bannerman,      Sir     Hugh, 

quoted,  148 
Canada 

British  investments  in,  184 

French  investments  in,  185 

population  density,  18 
Canal   Zone,   Panama,   28-n. 
Cane,  see  Sugar 
Cane,  Bavarian,  149 
Cape  Argus,  113 
Cape  Colony,  114 
Capital,  German  shortage  of,  191 
Capitalists,    in    South    Africa,    107, 

112,  113 
Capitulations,  68,  68-n 
Caribbean,  27-n 
Carthage,  14 

Casablanca  incident,  8,  142,  157 
Cassala,  Battle  of,  79 
Caste,  military  and  naval,  9,  10 
Catalonia,  119 
Cattle,  international  conference  on, 

199 
Caucasus,  160 
Causes  of  war,  listed,  2 
Cave  Report,  69 
Ceramics,    international    conference 

on,  199 
Cereals,  24,  224 
Cetewayo,  57 
Ceylon,  32,  35 
Cheese,  224 
Chelmsford,  Lord,  57 
Chemicals,  224 
Chemistry,  in  war,  221 
Chester,  Admiral,  quoted,  27-n 
Chile 

declaration  of  war,  58,  62 

economic  aims,  57,  63 

explorations  for  guano,  60 

nitrate,  59,  61-64 

revolution  in,  46 
China 

development  of,  210 

early  civilization,  197 

financial      pressure      on      Japan, 
193 

foreign  demands  in,  90-94 

French    investments   in,   185 

German  aggressions,  211 


China  (continued) 

Japanese  War,  46>  48>  49>  83-90 

Korean  claims,  49 

open  door  in,  226 

partition  of,  96,  97,  209,  217-n 

Russian  loan,  91 

seizure  of  territory,  89 

share  in  Korean  trade,  103,  104 

Thibet,  suzerainty  in,  35 
Chincha  Islands,  58 
Chinese  Empire,  93 
Chosen,  see   Korea 
Christianity,  in  war,  4 
Churchill,  Winston  Spencer,  quoted, 

31 
Civil    War,   American,   5,   203,   208, 

213 
Clements,  Paul  H.,  quoted,  95 
Cleveland,  President,  29-n 
Coal,  21,  224 
Cobden,  quoted,  217 
Cobija,  59 
Coke,  224 
Cologne,  168 
Colonies 

agronomy  in,  199 

causes  of  war,  3,  7,  11,  12,  50,  56 

classic,  14 

defense  of,  28,  30,  37 

India,  30-36 

methods  of  founding,  15 

need  of,  27,  139,  215 

overpopulation,  18 

readjustment,  230 

rivalry  for,  142 
Colombia,  revolution  in,  47 
Colquitt,  Governor,  quoted,  214 
Commercial  attache,  208 
Concert  of  Europe,  197,  198,  222 
"Condor,"  H.  M.  S.,  79 
Confederacy,  29-n 

Conferences,  international,   19S,  199 
Conservative  Party,  53 
Consolidated   Goldfields,   112 
Constantinople,   32,    39,   40,   41,   56, 
72,    97,    98,    124,    134,    135,    138, 
164,  167 
Co-operation,    economic,    of    Allies, 

222-226 
Copper 

German  supply,  21 

Japanese  supply,  27 

in  Morocco,  154 
Corsica,  130 
Cotton 

American,  23,  212-214 

British   supply,   23,  212,   213,  214 

Caucasian,  160 

Egyptian,  64 


256 


Index 


Cotton  (continued) 

French  supply,  24,  212 

German  supply,  21,  212 

in  Civil  War,  203 

in  World  War,  203 

Japanese  supply,  26 
Courts,  juvenile,  199 
Covenant,   League   of   Nations,  222 
Cowen,  Thomas,  quoted,  86-n 
Crammond,  Edgar,  quoted,  188,  189 
Credit,  industrial,  185 
Crete,  46,  124,  125,  126 
Creusot,  173 
Crimea,  40 

Cromer,  Lord,  79;  quoted,  64,  217-n 
Crosby,  Oscar,  quoted,  4 
Crown-Prince,   Austrian,  see   Ferdi- 
nand 
Crown-Prince,  Greek,  125 
Crusades,  4 
Cuba 

American  influence  in,  27-n 

American  intervention,  see  Span- 
ish-American War 

economic   conditions   in,   116,   118 

insurrection,  46,  48,  116-123 

juntos,   122 

reciprocity,  120 

Spanish    administration,    120,   122, 
123 

sugar  situation,  118 
Cunern,  117 
Cyprus,  32,  34 

D 

Dahomey,  French  operations  in,  46 

Dalmatia,  122,  175 

Dalni,  92,  99 

Damaraland,  126 

Damascus,  168 

Danube,  172,  173,  197 

Dardanelles,  97,  134 

Dardanelles  expedition,  31 

Davis,  Richard  Harding,  quoted,  150 

Death  rate,  German,  16 

DeBeers,  112 

Debt,  Egyptian 

cause  of  war,  76 

Consolidated  Debt,  71 

loans,  66 

totals,  70,  71 
Descent,  in  Moslem  countries,  70 
Diamonds,  South   African,   108,   109 
Diamond  Fields  Advertiser,  113 
von  Diedrichs,  Admiral,  92 
Delagoa  Bay,  111 
Denmark 

French  investments  in,  185 


Denmark  (continued) 
grain  imports,  212 
Virgin  Islands,  28,  29-n 
War  of  1864,  8 

Dillon,  E.  J.,  quoted,  4-n,  16-n 

Disraeli,  32,  41 

Dogali,  Italian  defeat  at,  79 

Dominican  Republic,  28-n 

Doumer,  M.,  82 

Dowager  Empress,  94 

Doyle,    Sir   Arthur   Conan,   quoted, 
106-n 

Dragoman  Pass,  77,  78 

Drang    nach    Osten,    124,    135,    143, 
158-60,  162 

Drang    nach    Osten,   Slavic,    98,    99 

Dreadnaughts,  33 

Dual  Control,  in  Egypt,  71,  72 

Dual  Entente,  43 

Dual    Monarchy,   see    Austria-Hun- 
gary 

Duelling,     international     conference 
on,   199 

Durazzo,  137 

Dutch,  in  British  colonies,  110 

''Dumping,"  German,  149,  218 

Dynamite  Monopoly,  111 

Dynastic  ambitions,  war  cause,  5 

E 

East,  see  Far  East  and  Near  East 
Eckstein  Group,   112,  113 
Economic  penetration,  156,  160,  169, 

172 
Economic  theory  of  history,  viii,  11 
Economic  union,  222-226 
Edward  VII,  quoted,  213 
Egypt 

allegiance,  34 

Bagdad    Railway,    danger    from, 
164,  165 

British  occupation,  46,  48,  64-76, 
139,  216 

debt,  70,  71,  76 

Fashoda  incident,  12,  74,  75,  191 

finances  investigated,  69 

foreign  investments  in,  194 

French  investments  in,  184,  191 

loans,   66,  68 

neutrality  in  Tripolitan  War,  132 

raw  materials  in,  64,  76 

revenues,  65 

revolt  in,  72 

Sudan,  wars  in,  73-75 

tobacco,  118 
Egyptian  Empire.  6 
Elgin  Commission,  179 
Emigration,  28,  129 


Index 


257 


Empire 

Assyrian,    6 

Babylonian,  6 

Chinese,  35,  93 

Egyptian,  6 

German,  7,  25 

Holy  Roman,  7 

Indian,  31 

Japanese,  24,  25 

Ottoman,  32,  158 

Roman,  11 

Russian,  50 
Ems  telegram,  2 
Engels,  Friedrich,  206 
England,  population,  15  and  15-n 
Entente,  43,  75 

Entomology,    international    confer- 
ence on,  199 
Eritrea,  Italian  colony,  79,  80 
Erzberger,  Matthias,  quoted,  227 
Erzerum,  169 
Ethnike  Hetaira,  125 
Eugenics,  199 

Euphrates  Valley,  158,  159,  162,  164 
Europe,  British  investments  in,  184 
Explosives,  224 
Exports,  see  Imports 


Fabian  Society,  217-n 

Fao,  165 

Far  East,  12,  139,  204,  218,  226 

Fashoda  incident,  12,  74,  75,  191 

Fats,  224 

Fellaheen,  67 

Ferdinand,  Archduke,  125,  142,  186 

Finance  in  war 

Boer  War,  106,  116,  179 

dual  role,  177,  178,  187,  192 

Russo-Japanese  War,  179,  180 

World  War,  181 
Financial  difficulties  in  war,  194 
"Fists  of  Righteous  Harmony,"  see 

Boxers 
Fiume,  135 
Flax,  224,  225 
Fleet,  British,  9,  22,  30,  33 
Fleet,  German,  9,  147,  227 
Fleet,  Russian,  169 
Fleets,  damages  to,  33 
Flottenverein,  9 
Flour,  Japanese,  26 
Fonseca  Bay,  28-n 
Foochow,  French  fleet  at,  82 
Food 

British  imports,  23 

Control,  223,  224 

French  imports,  23,  24 


Food  (continued) 

German  imports,  22 

Holland's  needs,  20 

Italian  situation,  132 

Japanese  situation,  25-27,  83,  84 

supply,  general  European,  212 
Forbes,  Archibald,  quoted,  52 
Foreign  investments 

American,  185,  190 

British,  183,  184,  192 

French,  184,  185,  192 

German,  183 
Formosa 

cession  to  Japan,  87 

French  blockade,  82 
France 

Bagdad  Railway,  167 

Balkan  loans,  139-n 

Balkan  trade,  173 

Berlin,  Treaty  of,  42 

birth  rate,  18 

Capitulations,  68 

Chinese  demands,  92,  93 

Egyptian  debt,  68 

first  Republic,  5 

Food  control,  223 

foreign  investments,  183,  190,  192, 
193 

Franco-German  trade  rivalry,  150— 
158,  204 

Franco-Prussian  War,  8,  178,  183 

Haiphong,  81 

Hanoi,  81 

imports  and  exports,  23,  24 

iron,   151 

Mexico,  29-n 

Morocco,  202,  209,  211,  216,  219 

population,  15,  15-n 

press,   in  war,  2 

railways  in  Asia  Minor,  168 

religions  in,  4 

Russian  loan,  180 

Texan  dispute,  1 
Freedom  of  the  sea,  see  Sea 
Free  trade,  217  and  217-n 
Frontier,  economic,  142 
Frontier,  "scientific,"  36,  52,  142 
Fruit,  canned,  224 
Fuel,  naval,  33,  34 
Fukien,  province  of,  92 
Furniture,   Bavarian,  149 
Furs,  see  Hides 


G 


Garibaldi,  Menotti,  72-n 
General  Staff,  American,  181,  182 
General  Staff,  German,  4-n,  178 
Genoa,  merchants  of,  190 


258 


Index 


Gensan,  99 

Georgia,  raw  materials  in,  209 

Germany 

agriculture,  decrease  of,  20 

American  loans,  192 

Balkan  policy,  135,  139 

Balkan  trade,  173 

Berlin,  Treaty  of,  in,  42 

birth  rate,  15,  16,  17,  18 

Chinese  demands,  92,  93 

coal,  21 

competition  with  British,  142 

cotton,  21 

"dumping,"  218 

financial  relations,  185,  188,  189 

foreign  investments,  183 

hegemony,  8 

imports  and  exports,  148,  212 

iron,  21,  151 

in  Korea,  104 

in   Morocco,  155,  209 

raw  materials,  21 

religions  in,  4 

Russian  loans,  180 

shortage  of  capital,  149 

trade  increase,  146,  147 

war  reserve,  gold,  178 
Gibraltar,  34 

von  Gierke,  Otto,  quoted,  145-n 
Gilchrist,  Percy,  152 
Glassware,  174 
Gortchakoff,  Prince,  41 
Gold 

discovered  in  Rand,  108 

German  war  reserve,  178 

in    Morocco,   154 

Wolseley,  Sir  Garnet,  on,  109 
Gold-credit,  185 
Golden  Horn,  32 
Gomez,  General,  121 
Good  Hope,  Cape  of,  32 
Gordon,  General,  73,  74 
Goschen-Joubert  mission,  69 
Goths,  11 

Grain  imports,  212 
Granite,  Bavarian,  149 
Great  Britain 

attitude  on  Bagdad  Railway,  167 

Balkan  policy,  135 

birth  rate,  18 

Chinese  demands,  90-92 

financial    relations,   188,    189 

food  control,  223 

foreign  investments,  183,  184 

French  investments,  185 

imports  and  exports,  148 

Japanese  alliance,  100 

Japanese  loans,   180 

Korean  trade,  104 


Great  Britain  (continued) 

Moroccan  interests,  155,  209 

religions  in,  4 

rivalry,  internal  economic,  208 

trade  increase,  146,  147 

trade  routes,  30 

Venezuela  boundary,  29-n 

trade  increase,  146,  147 
Greco-Turkish  War,  46,  48,  123-126, 

139 
Greece 

ancient,  196 

Bulgarian  treaty,  134 

Capitulations,  68-n 

colonization,   ancient,  14 

Crete,  136 

freedom,  7 

hostilities  during  London  Confer- 
ence, 138 

races,   133 
Guano,  58,  60 
Guatemala,  16 
Guiana  boundary,  29-n 
Gundamuk,  Treaty  of,  54 


Haidar-Pasha,  161,  164 
Hainan,  Island  of,  93 
Haingyondo,  Province  of,  85 
Haiphong,  French  seizure  of,  81 
Haiti,  28-n,  47 

Hamburg-American  line,  147 
Hanoi,  French  seizure  of,  81 
Hapsburg  dynasty,  3 
Harmony,    Fists   of   Righteous,   see 

Boxers 
Hawaiian  Revolution,  46 
Hegemony,  German,  8,  155 
Hemp,  159,  224,  225 
Herald,  New  York,  43 
Herero  Rising,  46,  48,  49,  126,  127, 

139 
von  Hertling,  Baron,  quoted,  163-n 
Herzegovina,      see      Bosnia-Herze- 
govina 
Hicks,  General,  73 
Hides,  24,  174,  224,  225 
Hinze,  Professor  Otto,  quoted,  144-n 
Hittites,  165 

Hobson,  J.  A.,  quoted,  106-n 
Holland 

Capitulations,  68-n 

French  investments  in,  185 

grain  imports,  212 

iron  imports,  151 

population,  18-n 

suffering  in  World  War,  19,  20 
Holy  Roman  Empire,  7 


Index 


259 


Hongkong,  seizure  of,  90-n 

Hottentot  Rising,  46,  127 

Huguenots,  108 

von  Humboldt,  Alexander,  58 

Hungary,  see  Austria-Hungary 

Huns,  h 

Hygiene,  racial,  199 


Imperialism,  American,  27  and  27-n 
Importation   and  shipping,   Council 

for,  224 
Imports  and  exports 

Austrian,  174 

British,  23,  148 

freedom  of,  215 

French,  23 

German,  21,  22,  148 

Italian,  24 

Japanese,  24 

Korean,  105 
Incas,  Peruvian,  58 
Indemnity,  French,  178 
Independent,    New    York,    quoted, 

194 
India 

civilization,  early,  197 

danger     from     Bagdad     Railway, 
162,  164,  165,  166 

defense  of,  64,  72,  76,  97,  218 

frontier,  51-53 

routes  to,  30-36,  41,  49 

Russian  ambitions,  32,  35,  39 

travel  to,  168 

value    to    Great    Britain,    30-36, 
218 
Indian  Ocean,  33 
Indo-China,  French  in,  81,  82 
Industries 

Austrian,  172 

Bavarian,  149 

colonial  requirements  of,  18 

growth  of,  11,  156 
Industrialism 

British,  203 

effect  of,  11 

French,  205 

German,  205 

internationalism,   relation  to,  201 

overpopulation,   cause   of,   18 

population,  relation  to,  204 
Industrial  states,  18,  19 
Insurrection,  Cuban,  46,  48,  49,  116— 

123 
Insurrectos,  122 

Intelligence  Service.  British,  114 
Interdependence     of     nations,     202, 
213-218,  220 


International  conferences  (1914),  200 
Internationale,  206 
Internationalism,  doctrine  of,  196 
Internationalism,  economic  origin  of, 

204 
International    finance — see    Finance 
International  law,  34 
Intervention    in    backward    states, 

209 
Investments,  foreign 

American,  185 

amounts,    182 

British,   183,   184 

French,  183,  184,  185 
Ireland,  civil  war  in,  3 
Iron 

British  supply,  23 

German  supply,  21 

Japanese  supply,  27 

Korean  exports,  104,  105 

Lorraine  fields,  147,  151 

Ukraine  fields,  159 
Irredentism,  Serbian,   173 
Isandhlwana,  57 
Ismail  Pasha 

bad  faith  of,  69 

canal  stock  sale,  32 

deposed,  70 

extortion,  67 

extravagance,  64,  65,  209 

seizure  of  land,  66 
Italy 

Abyssinian  Wars,  46,  48,  49,  78-80 

Bagdad  Railway,  170 

Balkan  interests,  173,  175 

birth  rate,  18 

Chinese  demands,  94 

economic  ambitions,  143,  144 

Egyptian  debt,  69 

Egyptian  sympathies,  72-n 

Emigration,  129 

financial     relations     with     Great 
Britain,  188 

food  control,  223 

French  investments  in,  185 

imports  and  exports,  24 

population  increase,  15,   15-n 

religions  in,  4 

Triple  Alliance,  42 

Tunis.  42 

Turkish  War,  29,  46,  48,  49,  128- 
132,   139 

Venezuelan  Boundary,  29-n 
Ito,  Marquis,  quoted,  86-n 


Jaffa-Jerusalem  Railway,  168 
Jameson  Raid,  29-n,  114 


260 


Index 


Japan 

agriculture,  25,  26 

British  Alliance,  100 

British  loans,  179,  180 

Chinese  War,  46,  48,  49,  83-90 

civilization,  early,  197 

finance,  in  Russian  War,  179,  180 

foreign  trade,  27 

French  investments  in,  185 

imports  and  exports,  24—27 

in  Korea,  103,  104,  105 

opening  of,  210 

press  in,  89 

population,  17,  25 

religions  in,  4 

Russian  War,  46,  48,  96-105,  179, 
180 
Jenkins's  Ear  War,  1,  2 
Johannesburg  Star,  113 
John,  King  of  Abyssinia,  79 
Joint  stock  banks,  English,  188,  189 
Julius  Tower,  178 
Juntos,  Cuban,  122 
Jute,  174,  224 
Juvenile  courts,  199 

K 

Kabul,  51 

Kaiser  Wilhelm  II,  29-n,   115,   161, 

163,  209 
Kaufmann,  General,  53 
Kavalla,  134 
Khartoum,  73,  74 
Khedive,  see  Ismail  Pasha 
Khyber  Pass,  51,  54,  55 
Kiao-Chau,  seizure  of,  91,  92 
Kiel  Canal,  31 
Kirk  Kilisse,  137 
Kitchener,  Lord,  74,  75 
Kochana,  atrocities  at,  137 
Kodok  (Fashoda),  74 
Koku,  English  equivalent,  25-n 
Konia,  161 
Korea 

area  and  crops,  83 

Chinese  claims,  84 

economic  difficulties  in,  49 

imports  and  exports,  105 

internal  reform,  86 

Japanese   economic  aims,   86,   87, 
87-n 

Japanese  influx,  103,  104 

population,  103 

Russo-Japanese   rivalry  in,  96 

Tonghak  troubles,  85 

trade,   104 

value   to   Japan,  83 
Koweit,    British    protectorate,    161, 
165 


Kowlung  Peninsula,  90,  90-n 

Kriiger,  President,  29-n,  111,  115 

Kriiger  Telegram,  115 

Krupps,  7,  22 

Kuang-chan-wan,  89 

Kultur,  British,  35 

Kultur,  German,  6,  141 

Kuram  Valley,  55 

Kuroki,  General,  102 

Kuropatkin,  General,  quoted,  99-n 

Kiistenland,  175 

Kwang  Chau,  92 

Kwangsi,  93 

Kwang  Tung,  93,  100 


Lancashire,  textile  mills,  23 
Language,  9 

Latane,  J.  H.,  quoted,  29-n 
Lead,  in  Morocco,  154 
League  of  Nations 

Covenant  of,  222,  228 

economic  program,  221,  228 

economic  union,  222-226 

Erzberger,   Matthias,  quoted,  226 

German  protests,  226 
Leather,  224 

Lecky,  W.  E.  H.,  on  war  causes,  3-n 
Legations  in  Pekin,  94 
Leutwein,  Colonel  Theodor,  126,  127 
de  Lesseps,  Ferdinand,  65 
Liao-Tung  Peninsula,  87,  92,  102 
Lima,  capture  of,  63 
Linguistics,  international  conference 

on,  199 
Lippert  dynamite  concession,  111 
Liverpool,  port  of,  147,  168,  187 
Livingstone,  David,  43 
Loans 

Egyptian,  66,  68 

French  in  Balkans,  139 

Japanese,  180 

Russian,  91,  180 

in  World  War,  181 
London,    financial    centre,    181-183, 

186,  188 
London  Stock  Exchange,  187 
Longwy,  iron  district,  152 
Lorraine,  147,  151 
Lule  Burgas,  137 
Lumber,  220 
Lytton,  Lord,  50,  53,  54,  55 

M 

Mahdists,  73,  75,  76 
Malgarejo,  Dictator,  61 
Mauritius,  32 


Index 


261 


Martinovich,    General,    136 

Macedonia,  41,   133,   136 

Madrid  Stock  Exchange,  186 

Majuba  Hill,  108 

"Maine,"  U.  S.  S.,  2 

Maize,  174 

Makela,  Italian  surrender  at,  80 

Malta,  32,  34 

Manchuria,  93,  96,   101 

Mandatary  Commission,  228 

Manchu  Government,  93 

Manganese,  159,  160 

Mansampo,  99 

Man-power,  in  war,  177 

Marchand,  Major,  74 

Margraf,  Andreas  Sigismund,   117-n 

Maritime    Transport    Council,    223, 

224 
Markets 

American,  120 

Austrian,  78,  135,  138,  172 

Balkan,   138 

British,  145,  148 

Cuban,  117,  118 

German,  138,  145,  214 

Italian,  132 

need  of,  11,  12,  27 

Spanish,  119,  123 

struggle  for,  140 

unhampered  access  to,  215 

war  cause,  27 
Marseilles,  168 
Marx,  Karl,  206 
Massacre,  Afghan,  54 
Massacre,  Turkish,  32 
Massachusetts,  textile  industry,  208 
Massowa,  occupation  of,  79 
Materiel,  Serbian  purchases,  172 
Maximilian,  29-n 
McKinley,  President,  quoted,  122 
Meats,  224 
Mecca,  168 
Medicine,    international    conference 

on,  199 
Menelik  of  Shoa,  79,  80 
Merchant  fleet,  British,  167 
Metallurgy,  international  conference 

on,  199 
Metric  Convention,  200 
Meuse  River,  197 
Mexico 

American  interests,  190 

French  invasion,  29-n 

French  investments  in,  185 
Michnai  Pass,  54 
Milan,  King  of  Serbia,  77 
Mittel-Europa,  135,  158 
Missionaries,  German,  murdered,  91 
Molybdenum  in  Korea,  105 


Money,  international,  185 
Monroe  Doctrine,  29-n 
Monroe,  President,  30 
Montenegro, 

economic  problems,  133,   135,  136 

freedom  of,  7 

war  with  Turkey,  133,  137 
Morocco 

Agadir  incident,  12,  142,  149,  156, 
157,  191,  192,  193 

civil  war  in,  47 

commerce,  155 

Franco-German  relations,  202,  209, 
211,  216,  219 

iron  and  minerals  in,  154 

revolt  of  troops,  47 

trade  percentages,  209 

Woolf,  L.  S,  quoted,  217-n 
Moslems,  133 
Moussoul,  164 
Mugi,  26 
Munich,  168 
Munitions  Council,  223,  224,  225 

N 

Napoleon,  5,  65,  117,  197 

Napoleon  III,  29-n,  67,  191 

Natal,  in  Zulu  War,  56 

Naumann,   Friedrich,  quoted,   145-n 

Naval  bases,  28,  33.  34,  36,  45,  219 

Naval  rivalry,  Anglo-German,  150 

Near  East,  12,  135,  193,  218,  226 

Nelson,  65 

Nepal,  35 

Netherlands  Railway,  111,  116 

Neumann  and  Company,  112 

Neutrality,  Belgian,  6 

Newsholme,  A.,  quoted,  15-n 

New  York,  187 

New  York  Herald,  43 

New    York    Stock    Exchange,    186, 
187 

Neymarck,  Alfred,  quoted,  182-n 

Nicaragua,  28-n,  47 

Nile  River,  66 

Nippon,  see  Japan 

Nitrates,  63.  224 

Nitrate  War,  46,  48,  57-64,  139 

Nobel's  Dynamite  Trust,  111 

Non-ferrous  metals,  224 

North  German  Lloyd,  147 

North  Sea,  160 

Norway 
French  investments  in,  185 
grain  imports,  212 
separation  from  Sweden,  7 

Novi-Bazar,   Sanjak   of,  4,   174 

Nubar  Pasha,  66 


262 


Index 


o 


Odessa,  169 

Oil,  33,  160,  224 

Oil  cakes,  26,  27 

Okkium,  Kun,  85 

Old  Testament,  religious  wars  in,  4 

Olympic  games,  196 

Opium,  174 

Orange  Free  State,  109,  113,  115 

Oriental  civilization,  197 

Origin  of  war,  see  War 

Ostend,  168 

Ottoman  Empire,  130 

Overpopulation,  see   Population 


Paint,  Bavarian,  149 

Palestine,  3 

Panama  Canal,  27-n,  28-n 

Panama,  Republic  of,  28 

Pan-Slav   policy,    134 

"Panther,"  German  gunboat,   191 

Paper,  224 

Paris  Bourse,  162,  184,  186,  191 

Paris  Conference  (1917),  224 

Paris,  Treaty  of,  102 

Passenger  trade,  British,  167 

Pathology,  international  conference 

on,  199 
Peace  Conference,  141,  199 
Pekin,  Relief  Expedition,  90,  94,  95 
Pelly,  Sir  Louis,  53 
Penjdeh  incident,  55 
Perim,  34 
Persia,  217-n,  219 

Persian  Gulf,  35,  160,  162,  165,  166 
Peru 

guano,  57,  60 

Incas,  58 

nitrate  of  soda  in,  69 

Nitrate  war,  2,  57-64 

restrictions  on  nitrate,  60 

treaty  with  Bolivia,  61 
Pescadores,  cession  of,  87 
Petrograd  Bourse,  186 
Petroleum,  174,  224 
Philip  II,  190 
Philippines,  46,  47 
Philippopolis,  Bulgarian  occupation, 

77 
Phoenicia,  14 
Phosphate  beds,  59 
Picot,  Battle  of,  78 
Pigs  as  war  cause,  1 
"Pig  War,"  136,  173,  213 
Ping  Yang,  Battle  of,  86 
Plomenatz,  136 


Population 

American,  18 

birth  rate,  15-18 

British,  17 

colonies,  relation  to,  15,  128-130, 
230 

death  rate,  17 

French,  15-18,  140 

German,  15-18,  158 

increase  of,  11,  14,  17 

Italian,  17,  79,  128-130 

Japanese,  18,  25,  27 

over-population,  18,  124 

stationary,  15 

surplus,   l5,   230 
Port  Arthur 

cession  to  Japan,  87 

fall  of,  86 

importance,  88,  96,  99 

Japanese  loss  of,  89,  91 

Russian  seizure,  90,  92 

siege  of,  102 
Port  Elizabeth,  111 
Port  Lazarev,  99,  100 
Porto  Rico,  27-n 
Portsmouth,  Treaty  of,  102 
Portugal 

African  colonies,  111 

French  investments  in,  185 

military  revolt  in,  46 
Postal  Union,  200 
Pound  Egyptian,  70-n 
Poverty,  British,  148 
Press,  Japanese,  89 
Pressure,  economic,  139 
Pressure,  financial,  191-193 
Pro-Boer  Party,  106 
Program  Committee,  223,  224,  225 
Prostitution,     international     confer- 
ence on,  199 
Prussia 

War  of  1864,  7 

Population,  15 
Psychic  research,  international  con- 
ference on,  199 

Q 

Quetta,  occupation  of,  53 

R 

Radiology,   international  conference 

on,  199 
Railways,    see    Trans-Siberian,    and 

Bagdad. 
Railways,    international    conference 

on,  199 
Rand,  107 


Index 


263 


Rassegna    Nazionale,    quoted,    129, 

130 
"Rattling  the  purse,"  192 
Raw  materials 

access  to,  217 

Afghan   War,   relation   to,  56 

American,    28 

British,  23 

Council,  223-225 

Egyptian,  64,  67 

French,  23,  24 

German,  22,  164 

industrial    requirements,    11,    12, 
27 

Japanese,  104,  105 

Mittel-Europa,  159 

Tripolitan,  128 

Ukrainian,  159 
Red  Sea,  Italy  on,  79 
Reichsbank,  178,  191 
Relief  Expedition  to  Pekin,  90 
Religion,  war  cause,  3,  3-n,  4,  4-n 
"Revanche,"  9,  143,   150,  153 
Revenge,  war  cause,  8 
Reventlow,     Count     von     und     zu, 

quoted,  144-n 
Rhine  River,  197 
Rhodes,  Cecil,  112,  113,  114 
Rhodesia  Herald,  113 
Rice,  26,  27 
Risorgimento,  128 
Robinson,  Albert  G.,  quoted,  117-n, 

121-n 
Robinson  Mines,  112 
Roman  Empire,  11 
Romanoff  dynasty,  3 
Rooke's  Drift,  57 
Rothschild    Exploration    Company, 

112 
Rotterdam,  port  of,  158 
Rumania 

Balkan  Wars,  133 

debt  to  France,  193 

freedom,  7 

grain  and  oil  fields,  160 

trade  with  Austria,  174 
Rumelia,  Eastern,  77 
Russia 

Agriculture,  39 

Anglo-Russian  agreement,  35,  39 

Bagdad  Railway,   169 

Balkan  policy,  41,  134 

British  relations,  50,  52 

Chinese  demands,  9l 

expansion  in  Asia,  32,  97 

finance,  Japanese  War,  179,  180 

French  investments  in,  184,  192 

German      economic     penetration, 
158 


Russia  (continued) 

India,  aggressions  on,  35 

Japanese  War,  46,  48,  96-105 

loan,  to  China,  91 

loans,  from  France  and  Germany, 
180 

religions  in,  4 
Russo-Chinese  Bank,  91 
Russo-Turkish  War,  169 

S 

Saghalin,  Russia  in,  98,  99 

Saigon,  capture  of,  81 

Salisbury,  Lord,  53 

Salonika,  134,  135,  137,  158 

Salonika-Monastir  Railway,  170 

Santo  Domingo,  47 

Sanjak    of    Novi-Bazar,    see    Novi- 

Bazar 
Sanmun,  94 

San  Stefano,  Treaty  of,  40,  52,  77 
Sarajevo,  1,  142 

Saturday  Review,  quoted,  145-n 
Saxony,  population,  18-n 
Scandinavia,      Russian      commerce 

with,  97 
Scheldt  River,  197 
Scutari,  137,  138 
Sea,  freedom  of,  36,  215,  216 
Sea-power,  227 
Sebastopol,  169 

Seed-testing,     international     confer- 
ence on,  199 
Seligman,  E.  R.  A.,  quoted,  123-n 
Senafe,  Battle  of,  79 
Seoul,  Japanese  population,  104 
Serbia 

access  to  sea,  173 

Austrian  trade,  172 

Austrian  War,  186 

Balkan  Wars,  133,  137 

Bulgarian  treaty,  134 

debt  to  France,  193 

economic  independence,  136,  174 

freedom,  7 

irredentism,  173 

"Pig  War,"  1,  136,  173,  213 

religions  in,  4 
Serbo-Bulgarian  War,  46,  48,  76-78 
Seward,  Secretary,  5 
Seychelles,  32,  35 

Shimonoseki,  Treaty  of,  86,  91,  101 
Shanghai,  French  rights  in,  93 
Shantung,  Germans  in,  97 
Shantung,  Japan  in,  102 
Shere  Ali,  53 
Shipping  Council,  224 
Siam,  Gulf  of,  33 


264 


Index 


Siberia,  wheat  in,  83 

Sicilian  Revolt.  46 

Sicily,  131 

Silk,  27 

Silver,  in  Morocco,  154 

Sivas,  169 

Skins,  see  Hides 

Skoda  works,  172 

Skuptschina,  Serbian,  173 

Slave  trade,  198 

Slivnitza,  78,  173 

Smyrna-Kassaba  Railway,  168 

Socialism,  184 

Societe  du  Chemin  de  Fer  Ottoman 

d'Anatolie,  161 
Sokotra,  35 
Somaliland,  47 
Sontai,  French  attack  on,  82 
South  African  Explosives  Company, 

111 
South  African  War,  see  Boer  War 
South  America,  28,  29,  29-n 
Spain 

American  War,  5,  46,  48,  116-123 

Armada,  190 

colonial  administration,  118,  122 

French  investments  in,  184 

grain  imports,  213 

iron,  152 

military  revolt,  46 
Speare,  Charles  F.,  quoted,  182-n 
Stanley,  Henry  M.,  43,  44 
Steel,  224 

Submarines,  22,  219,  220 
Sudan,  34,  49,  73,  191 
Suez  Canal,  32,  34,  39,  40,  49,  64,  67, 

69,  72 
Suez,  French  investments  in,  184 
Sugar,  21,  27,  117,  118,  174,  224 
Sulphur,  in  Morocco,  154 
Sultan  of  Turkey,  161 
Sweden 

iron,  152 

French  investments  in,  185 

grain  imports,  212 

separation  from  Norway,  7 
Switzerland 

French  investments  in,  185 

grain  imports,  212 
Syria,  164 


Tacna,  59,  64 
Tangier,  157 
Tanning  materials,  225 
Tarapaca,  59,  62-64 
Tariffs,  123,  158,  200 
Tariff  wars,  157 


Tashkand,  53 

Taurus  Mountains,  162 

Taussig,  F.  W.,  quoted,  15-n 

Taxes,  Boer,  113 

Taylor,  Hannis,  quoted,  120-n 

Tchataldja  lines,  137 

Tea,  27 

Tei-lien-wai.  99 

Tel-el-Kebir,  72 

Testament,  Old,  religious  wars  in,  4 

Tewfik  Pasha,  70 

Texas,  Republic  of,  1 

Textiles,  24,  147,  174,  199 

Thibet,  35,  47 

Thomas,    Sidney    Gilchrist,    44,    45, 

147,  152,  153 
Throne,  speech  from  the,  213 
Tientsin,  Treaty  of,  85 
Tigris-Euphrates    Vallev,    158,    159, 

164 
Timber,  224 
Tin,  224 

Tobacco,  118,  174,  224 
Tokio,  Bank  of,  180 
Tolzien,  G.,  quoted,  145-n 
Tonghak  movement,  85 
Tonkin,  82,  93 

Toronto  Stock  Exchange,  186 
Trade  increase,  146,  147 
Trade   routes,   30,  36,   45,   215,   216, 

218,  219,  227 
Transit,  freedom  of,  229 
Transport,  220,  223,  224 
Trans-Siberian     Railway,     99,     100, 

169 
Transvaal,  29-n,   106,  107,   109,   111, 

115 
Trek,  Great,  108 
Tribunaux  Mixtcs,  68,  69 
Trieste,  135,  158,  175 
Triple  Alliance,  43 
Tripoli,  49,  80,  209 
Tsar  of  Russia,  40,  91,  162 
Tsingtao,  89,  97 
Tsushima,  Straits  of,  99 
Turkestan,  Russians  in,  46 
Turkey 

Bagdad   Railway,   163,   166,   169 

Balkan  policy,  133 

delay  of  6th  Army  Corps,  169 

French  investments  in,  184 

Greek  War,  46,  48,  123-126 

Italian  War,  46,  48,  128-132 

Macedonia,  41 

Mittel-Europa,  158,  160 

religions   in,  4 

Russian  War,  40 

tobacco  in,  118,  174 

Tripolitan  interests,  49 


Index 


265 


Tungsten,  Korean,  105 
Tunis,  42,  129,  130 

U 

Uitlanders,  108,  109,  110,  114 
Ukraine,  raw  materials  in,  159 
Undeveloped  lands,  menace  of,  216 
Unemployment,  German,  149 
Unification,  national,  6,  7 
Union,  international  economic,  222- 

226 
United  Kingdom,  see  Great  Britain 
United  States 

British  investments  in,  184 

Capitulations,  68 

Food  Control,  225 

foreign  investments,  185,  190 

French  investments  in,  185 

imperialism,  27,  27-n 

internal    rivalry,   208 

investments    in    South    America, 
189,  190 

loans  to  Germany,  192 

population,  18,  27 

Spanish  War,  116-123 


Vassos,  Colonel,  125 
Venezuela,  29-n,  46 
Vienna,  1,  168 
Vienna  Bourse,  186 
Vilmorin,  Louis,  117,  117-n 
Virgin  Islands,  28-n 
Vladivostok,  39,  97,  98,  99,  209 

W 

Wakamatsu  Steel  Works,  105 
Wales,  population,  15-n 
War 

"altruistic,"  5,  6 

armaments,  9,  177 

causes,  1-14 

causes,  list  of,  3,  4 


War  (continued) 

dynastic,  4 

economic  motives  of,  11,  45,  63, 
64,  76,  77,  80,  83,  86-n,  87,  91, 
96,  103,  107,  123,  124,  128,  135, 
138-140,  143,  150,  175,  176,  204 

finance,  10,  177-180,  185-189,  194, 
195 

food  in  war,  177 

hatred  as  cause,  10 

inventions  in,  221 

language,  9 

man-power  in,  177 

prevention  of,  190-192,  194 

religion  in,  4 

unification,  national,  7 
Wei-hai-wei,  86,  90 
Wells,  H.  G.,  quoted,  146 
Wernher,  Beit  and  Company,  112 
Westphalian  coal,  152,  156 
Westphalian    manufactures,    149 
Weyler,  General,  121 
Wheat,  21,  26,  159,  224 
White  man's  burden,  6 
Wilhelm  II,  see  Kaiser  Wilhelm 
Wilson  Bill,  119 
Wolseley,  Lord,  72,  109 
Wool,  21,  24,  26,  174,  220,  224,  225 
Woolf,  L.  S.,  quoted,  217-n 


Yalu,  Battle  of  the,  86 

Yalu  River,  101,  216 

Yangtse  Valley,  92,  216 

Yellow  Sea,  Russian  interests  in,  98 

Young  Turks,  130,  131 

Yunnan,  93 


Z 


Zambesi   River,   114 
Zanzibar,  bombardment  of,  46 
Zollverein,  German,  159 
Zulu  War,  46,  48,  56,  139 


XI3€€9 


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